AUDUSD is trading near 0.6900 because it couldn’t keep the slight rise from the 0.6930 area. Investors are still worried about the possibility of a global recession, so the US dollar is in demand in Asia on Thursday.
At the current price level, the recent daily loss in the AUD/USD pair has retraced by 23.6%. On a daily chart, technical signs that aren’t good could show up.
Based on the 4-hour chart, this bearish extension looks more likely shortly. As the 20 SMA provides intraday support at about 0.6980, indicators are getting stronger below their midlines.
President Jerome Powell clarified that the Fed is committed to fighting inflation. It made the market worry that the Fed’s aggressive tightening could send the US economy into a recession. As long as the conflict in Ukraine and China’s currency restrictions continue, central bankers worldwide may feel compelled to fight inflation more aggressively.
Bulls can’t make money from the idea that the RBA will raise rates more quickly and by an enormous amount because the global economy looks terrible. On the second day of Powell’s hearing, people want to know more about where interest rates are going. The US PMI will look closely at the results of business surveys.
The AUD/USD pair could stop falling further if there isn’t much room for the downside. Bears are looking for short-term support levels.