Nov 02, 2022

VOT Research Desk

The AUD/USD is trading near the intraday high of 0.6427 ahead of Wednesday’s European session.

As a result, the Aussie pair extends the most recent bounce from the 100-EMA towards the one-week-old resistance line.

The AUD/USD rally is likely to continue, given the near-50 RSI (14) and an anticipated bull cross on the MACD.

The monthly symmetrical triangle between 0.6345 and 0.6500, however, limits the pair’s movements. However, near 0.6455, a convergence of the weekly resistance line and the 38.2% Fibonacci retracement of the pair’s September-October decline protects the quote’s immediate rebound.

It’s worth mentioning that the AUD/USD pair’s rise above 0.6500 requires confirmation from the 50% Fibonacci retracement level near 0.6545 to persuade bulls.

Following that, a run-up towards the most recent September swing high at 0.6750 is likely.

On the other hand, a clear breach of the 100-EMA support, which is close to 0.6390 at the time of writing, might immediately push AUD/USD sellers towards the mentioned triangle’s support near 0.6345.

If the bears gain control over 0.6345, the possibility of a new yearly low, around 0.6170 at the most, cannot be ruled out.

Oct 31, 2022

VOT Research Desk

After an optimistic start to the crucial week, the AUD/USD reversed from its intraday high with a 15-pip drop to 0.6402, as China’s activity statistics roused bearish.

By the time of press, the pair’s most recent weakness prints the three-day downtrend. In October, China’s official NBS Manufacturing PMI fell to 49.2 from 50.0 predicted and 50.1 in September. In addition, the Non-Manufacturing PMI fell to 48.7 from 51.9 market expectations and 50.6 earlier readings.

In line with market expectations, Australia’s September retail sales data earlier in the day were revised upward by 0.6%.In other markets, the AUD/USD movements are being hampered by sluggish Treasury rates, marginally offered US stock futures, and market jitters ahead of this week’s monetary policy meetings of the US Federal Reserve (Fed) and the Reserve Bank of Australia (RBA).

As a result of Macau locking down a casino resort, China’s covid problems also get worse. The worries caused by Russia’s withdrawal from the grain deal may be on the same track.

Following an attack on its Black Sea fleet, Russia, which invaded Ukraine on February 24, halted its participation in the Black Sea agreement on Saturday for a “indefinite term,” according to Reuters.

As a result, Russia could no longer “guarantee the safety of civilian ships” travelling under the agreement.

In the midst of these plays, US Treasury yields are directionless following a depressing report, and US equities futures show modest losses despite Dow Jones’ preparation for the largest monthly increase since 1976.

Additionally, the US Dollar Index (DXY), which is currently up 0.10% intraday, shows a three-day rise at 110.80.

Moving on, traders of the AUD/USD currency pair may find some amusement in the US second-tier activity statistics before the release of the RBA’s decision on Tuesday.

The Aussie pair may reverse the most recent downturn if the Australian central bank surprises the markets by announcing a higher-than-expected 0.25% increase in the benchmark rate.

AUD/USD Technical Analysis

The AUD/USD pair may struggle to entice the bears without shattering the 0.6370-60 support confluence, which consists of the 21-DMA and a two-week-old ascending trend line.

Oct 28, 2022

VOT Research Desk

The AUD/USD pair has continued to rise over the intraday resistance level of 0.6470 despite conflicting signs from the market’s mood.

In the absence of a positive trigger, S&P500 futures are hanging onto their morning losses, and 10-year US Treasury rates have risen again after falling to nearly 3.93%.

Following a sharp reversal on Thursday, the US dollar index (DXY) is struggling in the early European session at 110.40.

Strong Gross Domestic Product (GDP) figures from July to September caused the DXY to soar as a result. The US GDP for the third quarter came in at 2.6%, above expectations of 2.4%. Additionally, a change to an expansionary mode following an economic contraction in the first half of CY2022 resulted in a restoration of investor confidence in the outlook for the economy.

Investors’ attention will be drawn to the Federal Reserve’s (Fed) interest rate policy in the next week.

 The likelihood of a 75 basis point (bps) rate increase by the Federal Reserve (Fed) is 82.85%, according to the CME Fed Watch tool.

After a decline in consumer spending during the third quarter, the chances of a 75 basis point rate increase have been reduced.

This suggests that the market is not far from reaching inflationary pressures depletion. In Australia, a historic increase in inflation, reported this week at 7.3%, may influence the Reserve Bank of Australia’s (RBA) determination of the magnitude of the increase in the Official Cash Rate (OCR). RBA Governor Philip Lowe might continue to struggle with the decision of whether to resume his 50 bps rate hike cycle or opt for more frequent, smaller increases.

Oct 27, 2022

VOT Research Desk

The AUD/USD pair declines by almost 100 pip from a three-week high reached earlier on Thursday, but the intraday decline encounters some resistance close to the 0.6425 area.

During the early North American session, the pair swiftly makes a few pip gains and is now trading in the range of 0.6475-0.6480, albeit down more than 0.30% on the day.

The US dollar makes a decent intraday recovery from its lowest point since September 20 and ends up being a major contributor pushing the AUD/USD pair down.

After the Advance US GDP data revealed that the largest economy in the world increased by a 2.6% annualized pace during the third quarter, exceeding predictions for a print of 2.4%, the USD has maintained its bid tone.

This is a significant turnabout. However, this was partially offset by the GDP price index increasing by just 4.1%, which was significantly less than the 5.3% forecast and less than half of the 9.0% increase in the prior quarter.

This may be interpreted as the first indication of a moderated inflationary pressure, which fuels the idea that the Fed may tone down its hawkish outlook.

The US Treasury bond yields went down another stride as a result of the anticipation. This, together with the risk-on drive, caps the safe-haven dollar and gives the risk-averse Aussie some support. In addition, the better consumer inflation data released on Wednesday should support growing forecasts for a more aggressive Reserve Bank of Australia policy tightening, which should benefit the AUD/USD pair.

As a result, any significant pullback may still be viewed as a buying opportunity and is more likely to be transient. However, as attention turns to the FOMC meeting the following week, the upside potential appears to be constrained.

Oct 26, 2022

VOT Research Desk

In the Tokyo session, the AUD/USD pair fluctuated erratically in a range of 0.6372–0.6400. The US dollar index (DXY) has once again fallen below the 111.00 level, and the asset is currently trading around its intraday high.

Risk sentiment is now mixed as S&P500 futures saw losses in early trade following a three-day winning streak.

The yield on the US 10-year Treasury has decreased even more, to 4.09%.The asset has entirely recovered on a four-hour time frame following the breakout of the consolidation created in a two-week range of 0.6200-0.6356.

The major is circling the recent immediate barrier of 0.6411, set on Monday. Before an impulsive rally, there is a brief consolidation at the weekly highs that serves as a phase of inventory building.

The 20- and 50-period Exponential Moving Averages (EMAs), which are rising at 0.6343 and 0.6325, respectively, show that the trend has switched northward.

In addition, the Relative Strength Index (RSI) (14), which signals future increases, has moved into the positive zone of 60.00–80.00.

A clear break above Monday’s high at 0.6411 will support the Aussie bulls going forward.

This will cause the asset to move toward its low point on October 4 at 0.6451 and it’s high point on that day at 0.6548.

On the other hand, a downward break of Thursday’s low at 0.6229 will push the investment in the direction of the most recent two-year low at 0.6170 and the bottom in April 2020 at 0.5991.

Oct 25, 2022

VOT Research Desk

In the Tokyo session, the AUD/USD pair gave up its retreat move to a level close to 0.6350. The Aussie dollar is under stress because to China’s pessimism, which is influenced by Jinping.

Despite a little decline in S&P500 futures following back-to-back positive settlements, the risk-on impetus is still strong.

The US dollar index (DXY), which had a muted beginning in Tokyo, is currently striving to regain the key threshold of 112.00.Due to a bullish market, the 10-year US Treasury rates have decreased to 4.21%.

According to the CME FedWatch tool, there is a 95% likelihood that the Federal Reserve (Fed) will raise interest rates for a fourth time in a row by 75 basis points (bps). According to a Reuter’s poll on the Fed’s interest rate forecasts, the institution will announce a fourth consecutive 75 bps rate increase.

According to other findings of the Reuters survey, the central bank shouldn’t take a break until inflation is roughly half its present level. Without a question, the Fed’s aggressive rate raise cycle is also encouraging the possibility of an impending recession.

Fears of a recession have grown dramatically after US Treasury Chief Janet Yellen said that one “cannot rule out danger,” according to MSNBC news.

The US Gross Domestic Product (GDP) numbers released on Thursday will now take centre stage. The annualised GDP is anticipated to increase considerably to 2.4% from the previously estimated fall of 0.6%.

The extraordinary third term for Xi Jinping as president of China has alarmed the aussie bulls on the Australian front. China’s growth forecasts are in jeopardy, which has an effect on Australia’s trade estimates.

In addition, information from the Australian Consumer Price Index (CPI) is becoming increasingly popular. Estimates predict that annual headline inflation will increase from the previous release’s 6.1% to 7.0%.

Oct 24, 2022

VOT Research Desk

AUD/USD continues to be under pressure towards the intraday low of 0.6350 as it extends the most recent decline from a fortnight high on Monday during the Asian session.

The Aussie pair pares the first weekly advance in three weeks while retreating from a 21-DMA barrier. However, as long as the pair maintains the previous day’s upside breach of a declining resistance line from September 13, which is now support around 0.6290, the Aussie pair purchasers remain optimistic.

The stronger MACD indications and the RSI provide more encouragement for the bulls (14). It should be noted that a seven-day support line, which is now at 0.6260 as of press time, will serve as the purchasers of the AUD/final USD’s line of defense.

Should this line be broken, the price would immediately test the annual low that was set earlier in the month near 0.6170.

The 23.6% Fibonacci retracement level of the pair’s August-October slide, around 0.6405, will serve as an additional filter to the north, so a daily close above the 21-DMA level near 0.6375 won’t be sufficient to persuade the AUD/USD bulls.

The 50-DMA and the 38.2% Fibonacci retracement level, which are located at 0.6545 and 0.6625, respectively, present further upside resistance for the AUD/USD pair.

Oct 21, 2022

VOT Research Desk

Early on Friday, the AUD/USD currency pair records slight losses while resetting its intraday low at 0.6265. The Australian pair pulls back toward the one-week support line in this manner following Thursday’s bounce off it.

A trend channel with a negative slope that has been in place since September 2007.The AUD/USD pair’s decline beyond the a fore mentioned support line, which is now at 0.6240 at the time of press, is nonetheless being challenged by the most recent positive MACD signals, the first since mid-August, together with virtually oversold RSI.

The 0.6200 resistance level and the annual low of 0.6170 will serve as further obstacles for the AUD/USD bearish even if the quotation falls below 0.6240.

The support line of the aforementioned channel, which is close to 0.6050 at the latest, will be the major focus during the south-run seeking the 0.6000 psychological magnet and April 2020 bottom under 0.5980 in the event that the AUD/USD pair stays bearish above 0.6170.

As an alternative, recovery advances must not only break through the immediate resistance of 0.6305 to defy the bearish chart pattern, but also must close above the 21-DMA of 0.6375 to persuade buyers. A run-up toward the monthly high of 0.6580 will then likely occur.

The early September swing bottom at 0.6700 should be taken into consideration as it may tempt the AUD/USD bulls over 0.6540.

Oct 20, 2022

VOT Research Desk

Despite conflicting Australian data, the AUD/USD is still in the red around 0.6250 on Thursday as risk aversion and hawkish Fed bets drive up the US dollar.

The apprehension surrounding the People’s Bank of China’s (PBOC) monetary policy meeting may be the cause of the Aussie pair’s reluctance to retest the weekly low.

Australia’s top news Employment Change increased by 0.9K instead of the projected 25K and 33.5K, but the unemployment rate and participation rate were in line with market expectations at 3.5% and 66.6%, respectively.

The PBOC interest rate decision, which is anticipated to retain the benchmark rate at 3.65%, may serve as another negative check for the AUD/USD pair in the future. The Reserve Bank of Australia’s (RBA) reluctance to go strongly with rate rises, along with pessimistic mood and hawkish Fed bets, may prevent the AUD/USD from moving farther south.

Unless the price overcomes the 0.6285 barrier, defying a six-week-old falling trend channel, bears are still in control.