The AUD/USD currency pair on Friday surged to retest current weekly highs of about 0.7385 before pulling back late on to settle at 0.7370. The currency pair continues to trade within a sideways channel formation in the 60-min chart.

The currency pair has also now surged to trade in overbought conditions of the 14-hour RSI. It advanced to trade above the 100-hour moving average following Friday’s spike. A pullback could be on the cards.

AUD/USD Fundamentals Overview

From a fundamental perspective, the AUD/USD currency pair is trading at the back of a relatively busy period in both markets. On Friday the preliminary Michigan Consumer Sentiment Index for August missed the expectation of 81.2 with 70.2.  US export price index beat both on the (MoM) and (YoY) basis, while the import price index missed on the (MoM) and beat on a (YoY) basis. On Thursday, the initial jobless claims for the week ending Aug 06 matched the expected claim count of 375k. The producer price index ex-food and energy for July outperformed both on a (YoY) and (MoM) basis while general CPI ex-food and energy missed (MoM) expectation of 0.4% with 0.3%.

In Australia, the Consumer Inflation Expectations for August came short of 3.8% with a change of 3.3% on Thursday. And on Friday, the HIA New Home Sales for July fell by 20.5% (MoM) compared to the previous period’s gain of 14.5%. Earlier in the week, the Westpac consumer confidence for August fell 4.4% compared to a positive change of 1.5% in the previous reading.

AUD/USD Technical Analysis (the 60-min Chart)

Technically, the AUD/USD currency pair appears to be trading within a sideways channel formation in the 60-min chart. This indicates a lack of clear directional momentum in the market sentiment.

Therefore, the bulls will be looking to extend Friday’s rebound towards 0.7408 or higher to 0.7443. On the other hand, the bears will target potential pullbacks at around 0.7329 or lower at 0.7290.

AUD/USD Technical Analysis (the Daily Chart)

In the daily chart, the AUD/USD currency pair appears to be trading within a gently descending channel formation. This indicates a significant long-term bearish bias in the market sentiment.

Therefore, the bears will be looking to extend the current bearish run towards 0.7043 or lower to 0.6756. On the other hand, the bulls will target long-term profits at around 0.7605 or higher at 0.7885.