Analysis of AUD/USD: Exchange Rate Falls to Early May Low
FXOpen
As indicated by the 4-hour AUD/USD chart today:
→ the rate fell below 0.652, a level last seen on May 2;
→ the RSI indicator dropped below 15, a level last seen during the panic over the spread of COVID-19 in spring 2020.
The weakening of the Australian dollar could be linked to participants' expectations of upcoming news:
→ the US Core PCE Price Index will be published today at 15:30 GMT+3;
→ next week, Australian inflation data and the Federal Reserve's interest rate decision (both events scheduled for Wednesday) will be released.
Is further decline in the AUD/USD rate possible?
It is possible that the release of significant news could trigger a surge in volatility, causing the AUD/USD rate to fall below the recent monthly low of 0.652.
However, technical analysis of the AUD/USD chart suggests a potential recovery scenario:
→ The sequence of local extremes in the first half of 2024 forms a structure resembling a narrowing triangle. It appears the central axis is around 0.0665, and the bounce from low B indicates support from the Support 1 line.
→ Therefore, it is reasonable to assume that, in the context of increased volatility in the forex market, the AUD/USD rate has significantly deviated from the average values around 0.0665. At current quotes, some participants might want to lock in profits from short positions and/or position themselves for a short-term recovery of the "Aussie" from the oversold zone, following a 4% drop from A to B in 10 days.
Trade over 50 forex markets 24 hours a day with FXOpen. Take advantage of low commissions, deep liquidity, and spreads from 0.0 pips (additional fees may apply). Open your FXOpen account now or learn more about trading forex with FXOpen.
This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.
Stay ahead of the market!
Subscribe now to our mailing list and receive the latest market news and insights delivered directly to your inbox.
Latest articles
Euro and Pound Retreat from Highs After Strong US Data
The euro and pound have pulled back from their recent highs as the US dollar regained ground following a batch of stronger-than-expected economic data. The Personal Consumption Expenditures (PCE) price index accelerated to 3.7% year-on-year, compared with expectations of
Alibaba Analysis: Uptrend Break Attempt Amid Rising AI Investment
Alibaba reported its first-quarter results on 20 August, revealing a mixed picture for investors. Revenue increased by 9%, driven by accelerating growth in its cloud computing and AI businesses, but net profit fell by nearly three-quarters as capital expenditure on
EUR/AUD: A Hawkish Euro Meets a Stubborn Downtrend
The euro is riding genuine hawkish momentum right now. It's holding above $1.165 against the dollar, its strongest level since mid-May, with markets fully pricing in an ECB hike in September following June's initial tightening move. That conviction is