Bullish view
- Buy the AUD/USD pair and set a take-profit at 0.7200.
- Add a stop-loss at 0.6950.
- Timeline:1-2 days.
Bearish view
- Sell the AUD/USD pair and set a take-profit at 0.6950.
- Add a take-profit at 0.7200.
The AUD/USD pair was unchanged as traders embraced a risk-off sentiment after the Supreme Court ruling on Donald Trump's tariffs, which came out on Friday. It also wavered as traders waited for the closely-watched Australian inflation report. It was trading at 0.7055, a few points below the year-to-date high of 0.7155.
Australia Inflation Report
The AUD/USD pair remained in a narrow range as market participants reacted to the Supreme Court ruling on Donald Trump's tariffs on Friday.
The justices ruled that Trump erred when he implemented his global reciprocal tariffs. As a result, Trump announced new 15% global tariffs, which apply for all imports to the United States.
The new tariffs led to confusion, with investors embracing a risk-off sentiment. For example, US stocks plunged, with the Dow Jones falling by 850 points and the S&P 500 and Nasdaq 100 falling by over 85 and 315 points, respectively.
The next important AUD/USD news will come from the United States, where the Conference Board will release the latest consumer confidence report. Economists expect the report to show that confidence dropped to 84.3 from the previous 87.3.
The US will also release the latest house price index and the ADP weekly jobs report. Also, several key Federal Reserve officials like Austan Goolsbee, Raphael Bostic, Susan Collins, Lisa Cook, and Christopher Waller will talk.
The AUD/USD pair will react to the upcoming Australian inflation report, which will provide more hints on what to expect in the next Reserve Bank of Australia (RBA) meeting. Economists expect the report to show that the headline CPI dropped slightly from 3.8% to 3.7%.
AUD/USD Technical Analysis
The daily timeframe chart shows that the AUD/USD pair has pulled back from the year-to-date high of 0.7155 to the current 0.7055.
It remains above the important support level at 0.6945, its highest point in September 2024. It has remained above the 50-day and 100-day Exponential Moving Averages (EMA).
The pair has remained above the Supertrend indicator and the Ichimoku cloud. It has remained at the strong, pivot, and reverse level of the Murrey Math Lines tool.
Therefore, the pair will likely continue rising, initially to a year-to-date high of 0.7155. A move above that level will point to more gains, potentially to the psychological level at 0.7200.