AUDUSD Technical Analysis – Still trading in a range


  • The Fed hiked by 25 bps as
    expected and kept everything unchanged at the last meeting.
  • Fed Chair Powell reaffirmed their data dependency
    and kept all the options on the table.
  • The US CPI last
    week came in line with expectations, so the market’s pricing remained roughly
    the same.
  • The labour market
    displayed signs of softening although it remains fairly solid.
  • The other important economic data like the ISM
    Services PMI, Jobless Claims and Retail Sales all beat expectations recently.
  • The Fed members are leaning towards a pause in
    September and the next decision will still be dictated by the economic data.
  • The market doesn’t expect the Fed to hike at the
    September meeting, but there’s now basically a 50/50 chance of a hike in


  • The
    RBA kept its cash rate unchanged as expected at the last meeting as
    they are seeing signs that the economy is indeed slowing and that will help to
    return inflation back to target.
  • The
    data is supporting the RBA’s stance as the Australian jobs, wages and inflation data all remain lacklustre.
  • The
    Australian PMIs last month missed expectations
    remaining in contraction.
  • RBA
    Governor Lowe in his speech reaffirmed that if inflation remains sticky, they
    will have to tighten more.
  • 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
remains stuck in a rangebound market as the uncertainty around the global
economy and the future rates path is high. The pair might also be consolidating
after such a big selloff from the 0.69 handle just to resume the downtrend at
some point. The sellers are eyeing the resistance around
the 0.65 handle while the buyers will target a breakout to reach the 0.66

AUDUSD Technical Analysis –
4 hour Timeframe

On the 4 hour chart, we can see more closely the
range between the 0.6370 support and the 0.6500 resistance. The buyers continue
to have the upper hand as the price has been printing higher highs and higher
lows within the range. The target should be the 0.6500 resistance where we can
expect the sellers to pile in more aggressively with a defined risk above the
level and target the 0.6370 support, and eventually a break lower.

AUDUSD Technical Analysis –
1 hour Timeframe

On the 1 hour chart, we can see that the
price action has been very messy in the past few weeks with spikes all over the
chart. A break above the resistance zone around the 0.6445 level should lead to
a rally into the 0.6470 resistance. The sellers, on the other hand, might lean
on this 0.6445 resistance to target a fall into the 0.6405 support zone.

Upcoming Events

This week has just a couple of important economic
releases with the FOMC rate decision tomorrow being the highlight. The Fed is
expected to keep rates unchanged, and the market will focus more on the Dot
Plot and Fed Chair Powell’s press conference, although he’s likely to repeat
that they remain data dependent. Moving on to Thursday, we will see another US
Jobless Claims report, while on Friday we conclude the week with the Australian
and US PMIs data.

This article was written by FL Contributors at Source