US
- The Fed left interest rates unchanged as expected at the last meeting.
- The macroeconomic projections were revised higher,
and the Dot Plot showed that the FOMC still expects another rate hike by the
end of the year with less rate cuts projected in 2024. - Fed Chair Powell reaffirmed their data dependency but added that
they will proceed carefully. - The US CPI last week beat expectations on the
headline figures, but the core measures came in line with forecasts and the
market’s pricing barely changed. - The labour market remains fairly solid as seen once again yesterday
with the beat inJobless Claims, although continuing claims missed for a second
time in a row. - The US PMIs
recently showed that the US economy remains pretty resilient. - The University of Michigan Consumer Sentiment report last Friday missed across the
board with the inflation expectations figures spiking back up. - The US Retail Sales this week beat expectations by a big
margin with positive revisions to the prior figures. - The Fed members continue to cite elevated long-term
yields as a reason to proceed carefully and will likely pause in November as
well. - Fed Chair Powell yesterday highlighted the rise in long term yields
as well and the need to “proceed carefully”. - The market doesn’t expect the Fed to hike anymore.
Australia
- The
RBA kept interest rates unchanged as expected as they are seeing inflation
returning to target with the current level of interest rates. - The
latest monthly CPI showed that core inflation is
slowing. - The
labour market continues to weaken as seen this
week with the miss the employment change and the losses in full-time
employment. - The
Australian Manufacturing PMI fell further into contraction while
the Services PMI jumped back into expansion. - The
RBA Minutes were surprisingly hawkish and it
looks like the central bank might squeeze in another rate hike if the
underlying inflation doesn’t slow faster in the next couple of months. - The
market expects the RBA to hold rates steady at the next meeting as well.
AUDUSD Technical Analysis –
Daily Timeframe
On the daily chart, we can see that the AUDUSD pair
continues to fall but in a rangebound manner as the bearish momentum remains
weak. The price recently bounced on the previous low but got rejected from the resistance around
the trendline.
AUDUSD Technical Analysis –
4 hour Timeframe
On the 4 hour chart, we can see that the recent
price action formed a descending triangle with the
trendline and the support at 0.6285 defining the pattern. The best strategy
would be to wait for a breakout on either side of the pattern and go with the
flow. From a risk management perspective though, the sellers should lean on the
trendline with a defined risk above it to position for a break below the
support. The buyers, on the other hand, should lean on the support to position
for a rally into the trendline targeting a breakout.
AUDUSD Technical Analysis –
1 hour Timeframe
On the 1 hour chart, we can see more
closely the price action within the triangle that is generally messy and quite
erratic. In fact, as previously mentioned, the only levels to watch should be
the trendline and the support.
This article was written by FL Contributors at www.forexlive.com. Source