Daily Price Outlook
The AUD/USD pair benefited from positive Australian sentiment data and the overall weakness in the US Dollar as bulls successfully broke above the critical resistance level of 0.6700 on Tuesday morning.
The pair capitalized on the lower US jobs report and negative US inflation forecasts, while paying little attention to recent hawkish comments from the Federal Reserve and the easing inflation concerns in China.
The Westpac Consumer Confidence Index for Australia exceeded expectations in July, rising by 2.7%. Additionally, the National Australia Bank's monthly business confidence numbers for June showed encouraging results. Business conditions improved from a score of 8 to 9, while business confidence increased from -4.0% to 0.0%.
Despite these positive Australian indicators, Federal Reserve officials continued to maintain a hawkish stance, which tested the resilience of the AUD/USD bulls. Mary Daly, president of the San Francisco Federal Reserve, emphasized the need for additional rate hikes to bring inflation back to the Fed's target.
Cleveland Fed President Loretta Mester also suggested the necessity of further monetary policy tightening to address inflation concerns. Vice Chair for Supervision at the Federal Reserve, Michael Barr, emphasized the central bank's commitment to bringing inflation down to the target level.
Looking ahead, traders monitoring the AUD/USD pair should focus on the risk factors that could influence intraday movements, as the economic calendar is relatively light before the significant events on Wednesday.
AUD/USD Price Chart – Source: Tradingview
AUD/USD - Technical analysis
The AUD/USD pair has made a rebound, surpassing the 0.6665 level and closing above it, indicating the potential for a bullish wave on an intraday basis. Our analysis suggests a possible move towards the next significant level at 0.6780.
The presence above the EMA50 provides support for the anticipated bullish trend, and breaking above 0.6705 would facilitate the achievement of our target. However, the bullish trend remains valid as long as the pair does not break below 0.6665 and sustain below it.
For today's trading, the projected range is expected to be between the support level at 0.6640 and the resistance level at 0.6750.
Overall, the outlook for today indicates a bullish trend in the AUD/USD pair.
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