Fundamental
Overview
The USD continues to remain
under pressure amid positive risk sentiment and the imminent rate cuts from the
Fed which should help global growth. These are generally bearish drivers for
the greenback.
In fact, the appreciation
of the AUD has been mostly driven by the US Dollar side of the equation,
although it outperformed the other major currencies due to the hawkish RBA. In
fact, the market pared back more aggressive rate cuts expectations and it’s now
seeing just one cut by the end of the year.
The focus will be on
tomorrow’s Flash PMIs and then Fed Chair Powell speech at the Jackson Hole
Symposium on Friday.
AUDUSD
Technical Analysis – Daily Timeframe
AUDUSD Daily
On the daily chart, we can
see that AUDUSD had an incredible rally from the lows set at the beginning of August
as the market erased the growth scare and added to the gains as the risk sentiment
kept on improving. The next target for the buyers should be the high at the
0.68 handle. The sellers, on the other hand, will want to see the price falling
back below the key 0.67 handle to start target new lows.
AUDUSD Technical
Analysis – 4 hour Timeframe
AUDUSD 4 hour
On the 4 hour chart, we can
see that we now have a good support
zone around the 0.67 handle where we can find also the trendline
for confluence.
This is where we can expect the buyers to step in with a defined risk below the
trendline to position for new highs with a better risk to reward setup. The
sellers, on the other hand, will want to see the price breaking lower to pile
in for a drop into the 0.6550 level next.
AUDUSD Technical
Analysis – 1 hour Timeframe
AUDUSD 1 hour
On the 1 hour chart, there’s
not much else we can glean from this timeframe other than waiting for a pullback
into the key support zone where the buyers will look for a bounce, while the
sellers will look for a break. The red lines define the average daily range for today.
Upcoming
Catalysts
Tomorrow we get the Australian PMIs, the US Jobless Claims and US PMIs. On
Friday we conclude the week with Fed Chair Powell speaking at the Jackson Hole
Symposium.