AUD/USD Price Analysis – Dec 17, 2024
Daily Price Outlook
During the European trading session, the AUD/USD pair extended its downward trend, struggling to hold ground and slipping to an intra-day low of 0.6337, remaining under pressure near the 0.6340 level.
The pair's decline is largely driven by a bullish US Dollar (USD), which is benefiting from firm expectations that the Federal Reserve (Fed) will signal a more cautious approach to easing monetary policy during its upcoming meeting on Wednesday.
This comes after the Fed is expected to lower interest rates by 25 basis points (bps) to a range of 4.25%-4.50%.
On the other hand, the Australian Dollar remains weak, weighed down by a subdued market sentiment and rising speculation that the Reserve Bank of Australia (RBA) may start cutting its Official Cash Rate (OCR) as early as February.
These factors, combined with the overall risk-averse mood, are keeping the AUD/USD pair under persistent selling pressure. Traders are now closely watching key economic developments and central bank signals for the next directional move.
Australian Dollar Weakens Amid Economic Concerns and Trade Tensions
On the AUD front, the Australian Dollar (AUD) is struggling across the board due to a weak market sentiment and growing concerns that the Reserve Bank of Australia (RBA) might start cutting its key interest rate (Official Cash Rate, or OCR) as early as February.
This has put pressure on the currency, as traders expect further easing of monetary policy. Additionally, a 2% decline in Australia’s Westpac Consumer Confidence for December, following a 5.3% increase in November, has raised concerns about the country's economic outlook.
Furthermore, the AUD is also being weighed down by external factors, particularly concerns about China's economic growth. With US President-elect Donald Trump expected to impose new tariffs on China, the Australian Dollar is feeling the pressure.
This is especially concerning for Australia, as China is its largest trading partner. The combination of internal economic worries and external trade tensions is keeping the AUD under strain and contributing to its ongoing weakness.
AUD/USD – Technical Analysis
The Australian Dollar (AUD/USD) continues to face bearish pressure, trading at $0.63458, down 0.38% for the session. On the 4-hour chart, the pair has slipped below the pivot point at $0.63619, reinforcing near-term downward momentum.
Immediate resistance lies at $0.63823, closely aligned with the 50 EMA at $0.63719, which adds a dynamic ceiling for further recovery. Any sustained move above this level could target the next resistance at $0.64025 and extend gains toward $0.64287.
On the downside, immediate support is observed at $0.63367. A break below this level opens the door for sellers to test further support at $0.63156 and potentially extend declines toward $0.62957.
The Relative Strength Index (RSI) stands at 36, signaling a bearish trend with oversold conditions approaching.
Technical indicators suggest sellers remain firmly in control, with the price trading below both the pivot point and the 50 EMA, highlighting a sustained bearish outlook.
The pair’s inability to reclaim $0.63619 confirms strong selling pressure, with a potential for further downside if the current sentiment persists.
Conclusion: Traders may consider a Sell Stop entry at $0.63509, targeting a take-profit level of $0.63171, with a stop-loss placed at $0.63800 to manage risk.
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