Inflation in Australia Continues To Decline. AUD/USD Tests Important Support

FXOpen

Data today from the Australian Bureau of Statistics on Wednesday showed the monthly consumer price index (CPI) rose 4.3% year-on-year in November, the slowest pace since January 2022. Value a month earlier = 4.9%. Market forecasts = 4.4%.

This strengthened market expectations that interest rates would not have to rise further. Although the head of the Reserve Bank of Australia, Michele Bullock, warned of the risks of rising price pressures caused by domestic demand, for example, due to rising prices for rental housing.

Against the backdrop of the publication of news about inflation in Australia, no strong surges were noticed in the AUD/USD market. Perhaps this was due to the fact that there were no surprises.

Meanwhile, the 4-hour chart shows that the AUD/USD rate is nearing important support, which is formed by the lower line of the trend channel (shown in blue), within which the price has been moving since last fall.

Wherein:
→ in 2024, the price managed to push off from this line several times, but continued growth did not follow;
→ the highs of the days of January 4, 5 and 9 form a sequence of falling tops;
→ on January 5, prices broke through the low of December 15, but then rose sharply — a sign of demand below the level of 0.667.

Thus, the chart provides evidence to suggest that the forces of demand have enough capacity to prevent the price from falling, but are so exhausted that they cannot resume the upward trend in the blue channel.

It is possible that the AUD/USD market will trade in a restrained manner until the release of tomorrow's inflation news in the US (16:30 GMT+3), which could lead to the formation of a new balance of supply and demand.

Trade over 50 forex markets 24 hours a day with FXOpen. Take advantage of low commissions, deep liquidity, and spreads from 0.0 pips. 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

   Weekly Market Wrap With Gary Thomson: GBP/USD, EUR/USD, USD/JPY, XAU/USD, NVDA Stock
Financial Market News

Weekly Market Wrap With Gary Thomson: GBP/USD, EUR/USD, USD/JPY, XAU/USD, NVDA Stock

Get the latest scoop on the week's hottest headlines, all in one convenient video. Join Gary Thomson, the COO of FXOpen UK, as he breaks down the most significant news reports and shares his expert insights.

  • GBP/USD Hits Four-Month
Analysis of USD/JPY: Was There an Intervention?
Forex Analysis

Analysis of USD/JPY: Was There an Intervention?

Yesterday’s news of slowing inflation in the US sharply weakened the dollar, anticipating the Federal Reserve’s monetary easing. In the first 15 minutes after the data release:

→ EUR/USD rose by approximately 0.45% to the psychological level

What Is a Parabolic Arc Pattern, and How Can You Trade It?
Trader’s Tools

What Is a Parabolic Arc Pattern, and How Can You Trade It?

The parabolic arc pattern is a significant formation in technical analysis, showcasing rapid, exponential price movements that signal significant bullish momentum followed by sharp reversals. This article delves into identifying, trading, and managing the risks associated with parabolic arcs.

Understanding

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 60% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.