Bearish view
Sell the AUD/USD pair and set a take-profit at 0.6950.
Add a stop-loss at 0.7100.
Timeline: 1-2 days.
Bullish view
Buy the AUD/USD pair and set a take-profit at 0.7100.
Add a stop-loss at 0.6950.
The AUD/USD exchange rate wavered on Monday morning ahead of the relatively busy week from a data perspective. It was trading at 0.7013 on Monday, down from the year-to-date high of 0.7273.
Top Regulated Brokers
Australia Jobs and Inflation Data Ahead
The AUD/USD pair retreated last week as investors reacted to the hawkish interest rate decision by the Federal Reserve. In it, officials decided to leave interest rates unchanged between 3.50% and 3.75%. Many officials expect the bank will hike interest rates later this year.
The pair will next react to the upcoming US macro data, which will provide more information about the state of the economy. For example, S&P Global will publish the flash manufacturing and services PMI report on Tuesday. Economists expect the data to show that the services PMI rose 51 in June from 50.7 in the previous month. The manufacturing PMI is expected to have moved from 55.1 to 54.6.
The US will then publish the latest GDP and PCE reports later this week. Economists expect the data to show that the US PCE continued rising as energy prices remained at an elevated level. US inflation has remained above the Fed’s target of 2.0% for over five years.
Most of the crucial data that will move the AUD/USD pair will be from Australia, which will provide more information about the economy. Economists expect the upcoming data to show that the country’s CPI rose 4.3% in May from the previous 4.2% in April. Traders will pay closer attention to the trimmed and weighted mean inflation report.
Australia will next react to the upcoming Australian jobs report. Economists see the data to show that the economy added 30.3k jobs in May after losing 18.6k jobs in April. These numbers come a week after the Reserve Bank of Australia (RBA) left rates unchanged.
AUD/USD Technical Analysis
The daily chart shows that the AUD/USD pair has been in a downtrend in the past few weeks. It has slumped from a high of 0.7232 in May to the current 0.7013.
The pair has moved below the 23.6% Fibonacci Retracement level of 0.7071. It has continued forming a series of lower lows and lower highs. Also, it has slumped below the 50-day moving average.
Therefore, the pair will likely continue falling in the near term. If this happens, the next key level to watch will be at 0.6950, the 38.2% retracement level.
Ready to trade our free Forex signals? Here are the best forex platforms in Australia to choose from.