- During Friday's trading session, the AUD/USD currency pair attempted to break above the 0.69 level but encountered resistance, leading to a slight pullback.
- As market participants closely monitor this level, a potential correction seems plausible considering the currency's recent rapid ascent.
- Inflation data from the United States earlier in the week has sparked speculation about the Federal Reserve's future actions, impacting the US dollar against various currencies, including the Australian dollar.
AUD/USD Technical Outlook
The Australian dollar's ascent towards the 0.69 level faces a significant hurdle as this area has historically attracted considerable attention from traders. Given the currency's recent strong performance, the market is likely to perceive the current level as an overextension. However, a decisive break above 0.69 could pave the way for further upside momentum, with the psychologically significant 0.70 level becoming the next focal point for market participants.
In the event of a breakdown below the 0.68 level, the 200-Day Exponential Moving Average (EMA) near 0.6750 becomes a likely test area. This level is important as it defines the overall trend and may attract significant buying interest. However, the market may view the flat 200-Day EMA as only moderately influential in the short term. Should prices continue to decline, the 50-Day EMA near the 0.67 mark, which represents the upper boundary of a recent consolidation range, could serve as a further support level.
While the Australian dollar's chart suggests the potential for consolidation, the recent swift and substantial ascent indicates the need for a corrective phase. The performance of the US dollar, driven by broader market sentiments, will play a significant role in determining the Australian dollar's trajectory. As inflationary concerns continue to linger, developments in US inflation data and the Federal Reserve's actions are expected to exert ongoing influence on the currency's movements.
The Australian dollar's recent attempt to break above the 0.69 level faced resistance, suggesting a potential corrective pullback. Market participants are closely monitoring key levels and keeping a watchful eye on US inflation data and Federal Reserve policy for further guidance.
Potential Signal
- The Aussie has shown how strong it can be.
- If we break above the 0.69 level for more than an hour, I am a buyer, with a stop loss at the 0.6825 level, and a target of 0.7055 above.
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