AUD/USD Price Analysis – Dec 12, 2024
Daily Price Outlook
During the European trading session, the AUD/USD currency pair kept its upward momentum, staying strong around the 0.6418 level and reaching a peak of 0.6430.
The Australian dollar remained supported by mixed domestic employment data, with the seasonally adjusted Employment Change showing a rise of 35,600 jobs in November.
This pushed the total number of employed people to 14,535,500, far exceeding the previous figure of 12,100 and the expected 25,000.
Additionally, the Unemployment Rate dropped to 3.9%, the lowest since March, better than the anticipated 4.2%. However, the Australian dollar faced some headwinds as the US dollar strengthened after the release of the US inflation data.
The Consumer Price Index (CPI) in the US rose to 2.7% year-over-year in November, up from 2.6% in October. On top of that, concerns over China’s economic response to potential US tariff hikes added more downward pressure on the AUD.
Impact of Mixed Economic Data and US-China Tensions on the AUD/USD Pair
On the China front, the Australian dollar faced downward pressure as China, a key trading partner of Australia, considered letting its currency, the Chinese Yuan, weaken in response to expected US tariff hikes.
This news added uncertainty, as markets feared the impact of new trade tensions between the US and China.
On Tuesday, Chinese President Xi Jinping expressed confidence in achieving China’s economic targets, stating that China would continue to drive global economic growth. He also warned that there would be no winners in tariff or trade wars.
In terms of economic data, China’s Trade Balance improved in November, reaching CNY 692.8 billion, up from CNY 679.1 billion the previous month.
Exports grew by 1.5% year-over-year, although this was a slowdown compared to October’s 11.2% growth. Imports also rose by 1.2%, recovering from a previous decline of 3.7%.
However, weak consumer price data from China showed a 0.6% drop in November, signaling challenges in the economic recovery and fueling expectations of additional fiscal and monetary stimulus in China.
Back in Australia, the AUD found support from mixed domestic employment data. The seasonally adjusted Employment Change rose by 35,600 in November, bringing the total number of employed people to 14,535,500.
This exceeded both the previous figure of 12,100 and the market’s expectation of 25,000. Additionally, the Unemployment Rate dropped to 3.9%, its lowest level since March, well below the expected 4.2%.
The Reserve Bank of Australia (RBA) kept the official cash rate unchanged at 4.35% in its December meeting, noting that while inflation risks have eased, they still require attention.
Australia's GDP growth for the third quarter was slower than expected, with a 0.3% rise, leading to speculation that the RBA may cut rates in April 2024.
Therefore, the mixed economic data from Australia, along with concerns over China's economic situation, provided support to the AUD.
However, the uncertainty surrounding US-China trade tensions and weak GDP growth led to downward pressure, limiting significant gains in the AUD/USD pair.
AUD/USD – Technical Analysis
The AUD/USD pair is trading at $0.64180, up 0.77%, reflecting a continuation of its bullish momentum on the 4-hour chart. The pair is supported by a strong pivot point at $0.64153, which serves as a critical level for further upside potential.
Immediate resistance is seen at $0.64719, followed by key levels at $0.65030 and $0.65267. A sustained move above these levels could open the door to further gains, targeting higher levels in the short term.
On the downside, immediate support lies at $0.63773, with additional support levels at $0.63460 and $0.63174 offering a safety net against pullbacks. The 50-day Exponential Moving Average (EMA) at $0.63993 is acting as a strong technical base, reinforcing the current uptrend.
The Relative Strength Index (RSI) stands at 63, indicating bullish momentum, though nearing overbought territory. This suggests potential for continued gains, albeit with caution as the pair approaches overextension.
Traders may consider entering long positions above $0.64156, with a target at $0.64576 and a stop loss at $0.63941 to manage downside risks.
Related News
- GOLD Price Analysis – Dec 12, 2024
JOIN LONGHORNFX TODAY
24/7 live support, lightning fast withdrawals, guaranteed safe and reliable trading platforms with a true ECN broker.