Time Zone: GMT +2
Time Frame: 4 Hours (H4)
Fundamental Analysis:
The AUD/USD currency pair is influenced today by significant economic events. Australia’s Consumer Inflation Expectations (Melbourne Institute) and comments from RBA Assistant Governor Sarah Hunter regarding labor market conditions will be key drivers for AUD volatility. Positive inflation expectations or hawkish comments from Hunter would likely strengthen the Australian Dollar. For the USD, traders will focus on the speech by Federal Reserve Bank of Cleveland President Beth Hammack, US Initial Jobless Claims, and Existing Home Sales data. Lower-than-expected jobless claims or robust home sales will boost the USD.
Price Action:
The AUDUSD chart analysis on the H4 timeframe indicates a clear bullish trajectory, characterized by periods of varied buying pressure. The currency pair is currently showing strong bullish momentum within an ascending channel, recently reaching a significant higher high. The price is hovering around the midline of the bullish channel, suggesting potential for short-term consolidation. A corrective move could potentially push prices toward the lower band of the channel.
Key Technical Indicators:
Parabolic SAR: The dots remain below the candlesticks, indicating ongoing bullish momentum. Traders should remain aware that a switch of the dots above the price candles could signal the onset of a bearish reversal.
Stochastic (21,3,3): Currently showing values of 92.92 and 94.22, suggesting an overbought condition. Although this implies strong bullish sentiment, it also increases the probability of a corrective pullback or a sideways consolidation in the short term.
Williams %R (14): The indicator is at -23.82, affirming the strong bullish momentum. However, it’s nearing the overbought threshold, and traders should remain cautious for potential reversals or periods of consolidation.
Support and Resistance:
Support: The immediate support level is located near 0.7000, aligning with previous price consolidation and the lower band of the ascending channel.
Resistance: The key resistance level is at approximately 0.7125, coinciding with the recent higher high and upper boundary of the bullish channel.
Conclusion and Consideration:
Technical and fundamental analysis of the AUDUSD pair suggests sustained bullish momentum with caution advised due to indicator overbought signals. Key technical indicators support the bullish narrative, but the potential for a corrective pullback is notable. Traders should closely monitor today’s significant economic announcements from Australia and the U.S., as volatility could significantly affect the currency pair’s direction.
Disclaimer: The analysis provided for AUD/USD is for informational purposes only and does not constitute investment advice. Traders are encouraged to perform their own analysis and research before making any trading decisions on AUDUSD. Market conditions can change quickly, so staying informed with the latest data is essential.
