Daily Price Outlook

- AUD/USD is trading at $0.66704, up 0.23%, with a pivot point at $0.6697.

- Immediate resistance at $0.6705, $0.6729, and $0.6754; support at $0.6640, $0.6620, and $0.6586.

- RSI at 66 and 50-day EMA at $0.6623 indicate nearing overbought conditions and strong support.

The AUD/USD is currently trading at $0.66704, up 0.23%, as it navigates within a consolidation phase on the 4-hour chart. The pivot point is set at $0.6697, which is crucial for determining the next price movement.

Immediate resistance levels are identified at $0.6705, followed by $0.6729 and $0.6754. These resistance levels are key hurdles that need to be surpassed for a sustained bullish momentum.

On the downside, immediate support is seen at $0.6640, with further support at $0.6620 and $0.6586. These support levels are essential in preventing deeper declines and will be closely monitored by market participants.

The Relative Strength Index (RSI) is at 66, indicating that the pair is nearing overbought conditions, which could signal a potential reversal or consolidation in the near term. The 50-day Exponential Moving Average (EMA) is positioned at $0.6623, providing a significant support level and reinforcing the bullish outlook.

The overall outlook for AUD/USD remains cautiously bullish above the $0.6697 pivot point. A break above this level could trigger further buying interest, targeting the higher resistance levels mentioned.

Conversely, a drop below the immediate support at $0.6640 could lead to increased selling pressure and test lower support levels.

The recommended entry point is to buy above $0.66616, with a take profit target at $0.66965 and a stop loss at $0.66398.

AUD/USD - Trade Ideas

Entry Price – Buy Above 0.66616

Take Profit – 0.66965

Stop Loss – 0.66398

Risk to Reward – 1: 1.6

Profit & Loss Per Standard Lot = +$349/ -$218

Profit & Loss Per Mini Lot = +$34/ -$21

Daily Price Outlook

During the European trading session, the AUD/USD currency pair maintained its upward trend and remained well bid around the $0.6672 level, hitting an intraday high of $0.6676. The robust performance was mainly driven by a combination of factors, including concerns over the US economic recovery exacerbated by weaker-than-expected economic data such as the latest US Retail Sales figures. This has prompted market participants to revise down their expectations for US Federal Reserve interest rate hikes, thereby weakening the USD.

At the same time, the Reserve Bank of Australia (RBA) has kept its Official Cash Rate (OCR) unchanged at 4.35% for the fifth straight meeting, maintaining a confident stance. This decision surprised some analysts who expected a more cautious approach due to global economic uncertainties. The RBA's focus on monitoring inflation closely and its decision not to lower rates soon have boosted investor confidence in the AUD, supporting its recent upward trend.

Impact of Hawkish Messages from the RBA on AUD/USD

On the AUD front, the Reserve Bank of Australia (RBA) maintained its Official Cash Rate (OCR) at 4.35% in its June meeting, extending the longest period without change since 2022. This decision has postponed expectations for rate cuts, bolstering the Australian dollar. The RBA highlighted economic uncertainty and challenges in achieving target inflation levels, signaling a cautious stance. It emphasized vigilance against potential inflationary pressures, indicating a prolonged wait for stable inflation.

Thus, the RBA's hawkish hold suggests a conservative approach amidst economic uncertainties, influencing market expectations towards a potential easing cycle starting in 2025.

Therefore, this sentiment has boosted demand for the Australian Dollar, pushing the AUD/USD pair higher as traders recalibrate their expectations for future interest rate differentials between Australia and the United States.

Weaker-than-Expected US Retail Sales Data and its Impact on AUD/USD

On the US front, the recent release of weaker-than-expected US Retail Sales data has added further support to the AUD/USD pair's upward momentum. The Commerce Department reported a modest 0.1% month-on-month increase in May, falling short of the anticipated 0.2% rise. This disappointing economic indicator has raised concerns about the strength of consumer spending, a crucial driver of US economic growth.

Market participants interpreted the poor Retail Sales figures as a potential signal for softer economic activity in the US, which could prompt the Federal Reserve to adopt a more accommodative stance in its monetary policy. However ,the comments from Federal Reserve officials, including hints at possible rate cuts later in the year, have further dampened the USD's appeal, contributing to its depreciation against the AUD.

AUD/USD - Technical Analysis

The AUD/USD is currently trading at $0.66704, up 0.23%, as it navigates within a consolidation phase on the 4-hour chart. The pivot point is set at $0.6697, which is crucial for determining the next price movement.

Immediate resistance levels are identified at $0.6705, followed by $0.6729 and $0.6754. These resistance levels are key hurdles that need to be surpassed for a sustained bullish momentum.

On the downside, immediate support is seen at $0.6640, with further support at $0.6620 and $0.6586. These support levels are essential in preventing deeper declines and will be closely monitored by market participants.

The Relative Strength Index (RSI) is at 66, indicating that the pair is nearing overbought conditions, which could signal a potential reversal or consolidation in the near term. The 50-day Exponential Moving Average (EMA) is positioned at $0.6623, providing a significant support level and reinforcing the bullish outlook.

The overall outlook for AUD/USD remains cautiously bullish above the $0.6697 pivot point. A break above this level could trigger further buying interest, targeting the higher resistance levels mentioned.

Conversely, a drop below the immediate support at $0.6640 could lead to increased selling pressure and test lower support levels.

The recommended entry point is to buy above $0.66616, with a take profit target at $0.66965 and a stop loss at $0.66398.

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Daily Price Outlook

Despite the upbeat Australian data, the AUD/USD pair failed to stop its downward trend and remained well offered around the 0.6643 level, hitting the intraday low of 0.6640.

However, the reason for its downward trend could be linked to the bullish US dollar, which gained traction in the wake of a hawkish stance from the US Federal Reserve (Fed).

In contrast to this, the previously released upbeat Australian data, including higher-than-expected Employment Change and Australia’s Unemployment Rate dropping to 4.0% from April’s 4.1% rate (as expected), was seen as a key factor that kept the lid on any additional declines in the AUD/USD pair.

Impact of Australian Economic Indicators and RBA Policy on AUD/USD Pair

On the AUD data front, Australia's Employment Change for May showed an increase of 39.7K employed persons, surpassing expectations of 30.0K and the previous month's 38.5K rise. The Unemployment Rate dropped to 4.0%, down from April's 4.1%, as anticipated.

However, Australia's NAB Business Confidence index fell to -3 index points in May, the lowest in six months and the first negative reading since last November.

Concurrently, Business Conditions decreased to 6 index points, slightly below the long-term average, indicating a mixed outlook for business sentiment despite the positive labor market data.

Moreover, National Australia Bank's Chief Economist Alan Oster noted concerns about economic growth alongside caution about rising inflation. He expects the Reserve Bank of Australia (RBA) to maintain current interest rates for the foreseeable future.

Meanwhile, RBA Governor Michele Bullock recently indicated that the central bank stands ready to raise interest rates if the Consumer Price Index (CPI) fails to return to the target range of 1% to 3%.

Therefore, the AUD/USD pair see support from strong employment data and a lower unemployment rate, but could face pressure from declining business confidence and potential RBA rate hike signals amid inflation concerns.

Impact of Hawkish Fed and US Economic Data on Gold Prices

On the US front, the broad-based US dollar has been gaining momentum due to a hawkish Fed stance on rate cuts. This bullish US dollar is seen as a key factor keeping AUDUSD pair lower. The Federal Reserve's recent decision surprised markets by projecting only one interest rate cut in 2024, down from the three cuts expected in March.

Meanwhile, this hawkish stance overshadowed softer US consumer inflation figures and led to higher US Treasury bond yields, boosting the US dollar. On the data front, the US Bureau of Labor Statistics (BLS) reported that inflation, measured by the Consumer Price Index (CPI), was unchanged in May for the first time since last June.

The annual inflation rate slightly decreased to 3.3% from 3.4%. The core CPI, which excludes food and energy prices, increased by 0.2% in May and rose 3.4% over the past year, down from a 3.6% increase in April and below the expected 3.5%.

Therefore, the AUD/USD pair faced downward pressure as the hawkish Fed stance bolstered the US dollar against non-yielding assets like gold, dampening demand for the Australian dollar amid mixed economic signals.

AUD/USD - Technical Analysis

The AUD/USD pair is currently trading at $0.66450, reflecting a 0.28% decline. The market is exhibiting bearish tendencies as it approaches crucial support levels. The key pivot point to watch is $0.67, a critical level that could dictate the next directional move for the pair.

Immediate resistance is found at $0.67, with subsequent resistances also aligned at $0.67, indicating a significant barrier for bullish attempts. On the downside, immediate support is at $0.66, followed by additional supports at $0.66 and $0.65. These levels are essential for identifying potential buying interest that may stabilize the price.

The Relative Strength Index (RSI) is at 53, suggesting a neutral stance but leaning slightly towards bearish momentum. The 50-day Exponential Moving Average (EMA) is positioned at $0.66, which the current price hovers around, indicating a potential consolidation phase or a pivotal point for future direction.

The current technical indicators suggest a cautious approach. The bearish sentiment below the pivot point of $0.67 indicates potential further downside if the price breaches immediate support levels. Conversely, a break above the resistance could signal a shift towards a bullish trend.

In conclusion, the technical outlook for AUD/USD remains bearish below $0.67. Traders may consider a buy limit order at $0.66271, aiming for a take profit level at $0.66678. A stop loss should be placed at $0.66007 to manage risk effectively.

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Daily Price Outlook

- AUD/USD trading at $0.66450, down 0.28%, approaching significant support levels.

- Immediate resistance at $0.67, with support at $0.66 indicating potential further downside.

- RSI at 53 and 50 EMA at $0.66 suggest a neutral to bearish outlook.

The AUD/USD pair is currently trading at $0.66450, reflecting a 0.28% decline. The market is exhibiting bearish tendencies as it approaches crucial support levels. The key pivot point to watch is $0.67, a critical level that could dictate the next directional move for the pair.

Immediate resistance is found at $0.67, with subsequent resistances also aligned at $0.67, indicating a significant barrier for bullish attempts. On the downside, immediate support is at $0.66, followed by additional supports at $0.66 and $0.65. These levels are essential for identifying potential buying interest that may stabilize the price.

The Relative Strength Index (RSI) is at 53, suggesting a neutral stance but leaning slightly towards bearish momentum. The 50-day Exponential Moving Average (EMA) is positioned at $0.66, which the current price hovers around, indicating a potential consolidation phase or a pivotal point for future direction.

The current technical indicators suggest a cautious approach. The bearish sentiment below the pivot point of $0.67 indicates potential further downside if the price breaches immediate support levels. Conversely, a break above the resistance could signal a shift towards a bullish trend.

In conclusion, the technical outlook for AUD/USD remains bearish below $0.67. Traders may consider a buy limit order at $0.66271, aiming for a take profit level at $0.66678. A stop loss should be placed at $0.66007 to manage risk effectively.

AUD/USD - Trade Ideas

Entry Price – Buy Limit 0.66271

Take Profit – 0.66678

Stop Loss – 0.66007

Risk to Reward – 1: 1.5

Profit & Loss Per Standard Lot = +$407/ -$264

Profit & Loss Per Mini Lot = +$40/ -$26

Daily Price Outlook

During the European trading session, the AUD/USD currency pair failed to halt its bearish rally and remained under pressure around the 0.6595 level, hitting an intraday low of 0.6592. However, the downward trend can be attributed to risk-off market sentiment, which undermined riskier assets like the Australian dollar and contributed to the AUD/USD pair's declines.

Meanwhile, the decline in Australia's NAB Business Confidence and Business Conditions indices exerted pressure on the AUD currency. On the flip side, the bullish US dollar, backed by robust US jobs data for May, which has reduced the odds of two Federal Reserve interest rate cuts in 2024, was seen as another key factor that kept the AUD/USD pair under pressure.

AUD/USD Pair Analysis: Economic Indicators and RBA Policy Uncertainties

On the AUD front, traders anticipate that the Reserve Bank of Australia (RBA) will maintain higher interest rates this year. RBA Governor Michele Bullock suggested that if the Consumer Price Index (CPI) doesn't return to the target range of 1%-3%, they're ready to increase rates, as reported by NCA NewsWire.

National Australia Bank (NAB) Chief Economist Alan Oster noted concerns about economic growth but also highlighted worries about inflation. He expects the RBA to keep rates steady for a while as they navigate through these contrasting risks, according to the official transcript.

On the data front, Australia's NAB Business Confidence index hit a six-month low of -3 index points in May, turning negative for the first time since November. Business Conditions also dipped to 6 index points, slightly below the long-run average.

On Friday, Australia's Trade Balance widened to A$6,548 million in May, surpassing the expected A$5,500 million and April's balance of A$5,024 million. Imports fell sharply by 7.2% in May, reversing April’s 4.2% increase, while exports contracted by 2.5%, following a 0.6% decline previously.

Therefore, the AUD/USD pair may face pressure due to concerns over Australia's economic growth and inflation, alongside uncertainties regarding RBA's interest rate decisions, exacerbated by negative trade balance and business sentiment data.

Bullish US Dollar Impact on AUD/USD Pair Amidst Positive Jobs Data

On the US front, the broad-based dollar has strengthened following positive jobs data, reducing expectations of an imminent interest rate cut by the Federal Reserve in September. This has kept US Treasury bond yields high, bolstering the dollar.

However, the speculation that the Fed will maintain higher rates for a longer period has lowered the probability of a September rate cut to about 50%, with markets now anticipating only one 25 basis point cut later in the year.

According to the US Bureau of Labor Statistics (BLS), May's US Nonfarm Payrolls (NFP) rose to 272,000, up from April's 165,000. Average Hourly Earnings, a measure of wage inflation, increased to 4.1% YoY in May from April's revised 4.0%, exceeding the market expectation of 3.9%.

Therefore, the AUD/USD pair may face pressure as the stronger US dollar, buoyed by robust jobs data, reduces expectations for a near-term Fed rate cut. This could keep the pair under downward pressure.

AUD/USD - Technical Analysis

The AUD/USD pair experienced a slight decline of 0.19%, bringing its price to $0.66020. This minor dip suggests a bearish sentiment in the market, with technical indicators pointing towards potential further declines. As we analyze the 4-hour chart, key support and resistance levels come into sharp focus, guiding traders on possible price movements.

The pivot point is positioned at $0.6612, slightly above the current price, serving as a critical juncture. Immediate resistance is seen at $0.6650, with subsequent resistance levels at $0.6699 and $0.6735.

Should the price manage to break through these levels, it could signal a shift towards a bullish trend. However, the bearish momentum is more pronounced, as indicated by the immediate support at $0.6575. Further support can be found at $0.6538 and $0.6497, levels that could be tested if the downward pressure continues.

The Relative Strength Index (RSI) is currently at 42, indicating a bearish momentum but not yet oversold. This suggests there is room for further declines before a potential rebound. The 50-Day Exponential Moving Average (EMA) is at $0.6639, reinforcing the bearish outlook as the current price remains below this significant moving average.

In conclusion, given the prevailing technical indicators and key price levels, a bearish strategy is advisable. An entry price with a sell order below $0.66267 is recommended, targeting a take profit at $0.65748 while maintaining a stop loss at $0.66596 to manage risk.

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Daily Price Outlook

- AUD/USD down 0.19%, trading at $0.66020, bearish outlook.

- Key support at $0.6575, resistance at $0.6650, guiding price action.

- RSI at 42, indicating bearish momentum with room for decline.

The AUD/USD pair experienced a slight decline of 0.19%, bringing its price to $0.66020. This minor dip suggests a bearish sentiment in the market, with technical indicators pointing towards potential further declines.

As we analyze the 4-hour chart, key support and resistance levels come into sharp focus, guiding traders on possible price movements.

The pivot point is positioned at $0.6612, slightly above the current price, serving as a critical juncture. Immediate resistance is seen at $0.6650, with subsequent resistance levels at $0.6699 and $0.6735.

Should the price manage to break through these levels, it could signal a shift towards a bullish trend. However, the bearish momentum is more pronounced, as indicated by the immediate support at $0.6575.

Further support can be found at $0.6538 and $0.6497, levels that could be tested if the downward pressure continues.

The Relative Strength Index (RSI) is currently at 42, indicating a bearish momentum but not yet oversold. This suggests there is room for further declines before a potential rebound.

The 50-Day Exponential Moving Average (EMA) is at $0.6639, reinforcing the bearish outlook as the current price remains below this significant moving average.

In conclusion, given the prevailing technical indicators and key price levels, a bearish strategy is advisable. An entry price with a sell order below $0.66267 is recommended, targeting a take profit at $0.65748 while maintaining a stop loss at $0.66596 to manage risk.

AUD/USD - Trade Ideas

Entry Price – Sell Below 0.66267

Take Profit – 0.65748

Stop Loss – 0.66596

Risk to Reward – 1: 1.5

Profit & Loss Per Standard Lot = +$519/ -$329

Profit & Loss Per Mini Lot = +$51/ -$32

Daily Price Outlook

During the European trading session, the AUD/USD currency pair maintained its upward trend and remained well bid around the 0.6650 level, hitting the intraday high of 0.6683 level.

The reason for its upward trend could be tied to a hawkish statement by Reserve Bank of Australia (RBA) Governor Michele Bullock on Wednesday. Moreover, the previously released upbeat Trade Balance data in Australia was seen as another key factor that kept the AUD/USD pair higher.

On the other side, the broad-based US dollar bearish bias, driven by the Fed rate cut, has played its major role in supporting the AUD/USD pair's gains. Moving ahead, traders seem cautious to place any strong positions ahead of the release of US employment data on Friday, including Average Hourly Earnings and Nonfarm Payrolls.

AUD/USD Strengthens Despite Economic Data Disappointments

On the AUD front, the upticks in the AUD/USD pair were bolstered further after the hawkish statement from Reserve Bank of Australia (RBA) Governor Michele Bullock on Wednesday.

Bullock hinted at possible interest rate hikes if the Consumer Price Index (CPI) doesn't rebound to the target range of 1%-3%. She also noted a slight easing in the labor market, as reported by NCA NewsWire.

These remarks suggest a proactive stance from the RBA to maintain economic stability, which could bolster confidence in the Australian Dollar. Additionally, any positive developments in the CPI and labor market could further support the currency's upward momentum.

On the data front, Australia's Gross Domestic Product (GDP) released on Wednesday showed modest growth of 0.1% in the first quarter, below the expected 0.2%. Annually, the economy expanded by 1.1%, slightly lower than the anticipated 1.2%.

Judo Bank's Purchasing Managers Index (PMI) for May was 52.5, falling short of the expected 53.1, while the Composite PMI dipped slightly to 52.1 from April's 53.0, indicating a slower growth rate in Australia's private sector output for the fourth consecutive month.

Therefore, the AUD/USD pair strengthened on RBA Governor Bullock's hawkish tone, despite Australia's lower-than-expected GDP growth and weaker PMI figures, signaling ongoing investor confidence in the Australian Dollar.

AUD/USD - Technical Analysis

AUD/USD is currently trading at $0.66443, reflecting a modest 0.12% increase on a four-hour chart timeframe. The pivot point is set at $0.6702, serving as a critical marker for potential price movements.

Immediate resistance is identified at $0.6699, with subsequent levels at $0.6735 and $0.6771. On the downside, immediate support is found at $0.6591, followed by $0.6559 and $0.6528.

The Relative Strength Index (RSI) is at 46, indicating neutral momentum, suggesting neither overbought nor oversold conditions. The 50-day Exponential Moving Average (EMA) is positioned at $0.6648, just above the current price, which implies a slight bearish pressure in the short term.

In conclusion, the AUD/USD pair shows potential for bullish movement above $0.66320. Traders are advised to consider buying at or above this level with a target price of $0.67024. A stop loss should be set at $0.65923 to manage potential downside risks.

The current technical indicators and key price levels suggest a cautious but optimistic outlook for buyers, especially if the price stays above the pivot point of $0.6702.

However, if the price falls below immediate support at $0.6591, it may signal a shift to a bearish trend, warranting close monitoring of subsequent support levels.

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Daily Price Outlook

- AUD/USD trades at $0.66443, up 0.12%, with neutral momentum and a 50-day EMA at $0.6648.

- Immediate resistance levels: $0.6699, $0.6735, $0.6771; support levels: $0.6591, $0.6559, $0.6528.

- Entry Price: Buy above $0.66320; Take Profit: $0.67024; Stop Loss: $0.65923 for risk management.

AUD/USD is currently trading at $0.66443, reflecting a modest 0.12% increase on a four-hour chart timeframe. The pivot point is set at $0.6702, serving as a critical marker for potential price movements.

Immediate resistance is identified at $0.6699, with subsequent levels at $0.6735 and $0.6771. On the downside, immediate support is found at $0.6591, followed by $0.6559 and $0.6528.

The Relative Strength Index (RSI) is at 46, indicating neutral momentum, suggesting neither overbought nor oversold conditions. The 50-day Exponential Moving Average (EMA) is positioned at $0.6648, just above the current price, which implies a slight bearish pressure in the short term.

In conclusion, the AUD/USD pair shows potential for bullish movement above $0.66320. Traders are advised to consider buying at or above this level with a target price of $0.67024. A stop loss should be set at $0.65923 to manage potential downside risks.

The current technical indicators and key price levels suggest a cautious but optimistic outlook for buyers, especially if the price stays above the pivot point of $0.6702. However, if the price falls below immediate support at $0.6591, it may signal a shift to a bearish trend, warranting close monitoring of subsequent support levels.

AUD/USD - Trade Ideas

Entry Price – Buy Above 0.66320

Take Profit – 0.67024

Stop Loss – 0.65923

Risk to Reward – 1: 7

Profit & Loss Per Standard Lot = +$704/ -$397

Profit & Loss Per Mini Lot = +$70/ -$39

Daily Price Outlook

- AUD/USD is trading at $0.66671, down 0.28%, with a bearish outlook below the $0.6680 pivot point.

- Immediate resistance levels are set at $0.6709, $0.6735, and $0.6755, indicating potential upward barriers.

- Support levels at $0.6640, $0.6616, and $0.6591 could serve as key areas for potential downward movements.

The AUD/USD pair is currently trading at $0.66671, reflecting a decline of 0.28% in the 4-hour timeframe. The pivot point at $0.6680 is crucial, serving as a benchmark for potential price movements.

Immediate resistance levels are identified at $0.6709, $0.6735, and $0.6755. These levels indicate where the pair might face upward barriers.

On the support side, immediate support is at $0.6640, followed by $0.6616 and $0.6591. The 50-day Exponential Moving Average (EMA) is positioned at $0.6641, suggesting a near-term support level that traders should monitor closely.

The Relative Strength Index (RSI) is at 54, indicating a neutral market sentiment with a slight leaning towards bullishness.

The current technical setup suggests that the AUD/USD pair might continue to face downward pressure if it fails to break above the pivot point of $0.6680. Given the alignment of the 50 EMA close to the current price, a failure to hold above this level could result in further declines.

The recommended strategy under these conditions is to sell below $0.6680, targeting a take-profit level at $0.6640, with a stop loss at $0.6710.

In conclusion, the outlook for AUD/USD remains bearish below $0.6680. Immediate resistance levels at $0.6709, $0.6735, and $0.6755 could cap any potential upward movements.

On the downside, immediate support at $0.6640 and further levels at $0.6616 and $0.6591 should be monitored closely for signs of continued bearish momentum.

AUD/USD - Trade Ideas

Entry Price – Sell Below 0.66891

Take Profit – 0.66400

Stop Loss – 0.67095

Risk to Reward – 1: 2.4

Profit & Loss Per Standard Lot = +$491/ -$204

Profit & Loss Per Mini Lot = +$49/ -$20

Daily Price Outlook

The AUD/USD currency pair remained bearish around the 0.6642 level, hitting an intraday low of 0.6631. The downward trend can be attributed to Australia's unexpected current account deficit of A$4.9 billion (USD 3.2 billion) in the first quarter, signaling weaker economic fundamentals and putting downward pressure on the AUD.

Additionally, the renewed strength of the US dollar, supported by higher US Treasury yields and prevailing risk aversion, contributed to the bearish trend. On the other hand, the RBA's concern about persistent inflationary pressure may support the AUD/USD pair by indicating potential interest rate hikes, thus limiting losses against the USD.

AUD/USD Pair Faces Pressure from Economic Data and Inflation Concerns

On the AUD front, the Australian Bureau of Statistics (ABS) reported a current account deficit due to increased imports, especially of consumption goods, which outweighed a decrease in exports, mainly coal and iron ore.

This news added pressure on the Australian dollar. Additionally, RBA Assistant Governor Sarah Hunter highlighted inflationary concerns, noting that inflation staying above the target range of 1%-3% is a key issue.

On the data front, Australia's Judo Bank Manufacturing PMI, released on Monday, showed a slight increase to 49.7 in May from 49.6 in April. This marks the fourth straight month of declining conditions in the manufacturing sector, suggesting ongoing challenges for this part of the economy.

Therefore, the AUD/USD pair faces downward pressure due to Australia's current account deficit and manufacturing sector challenges, alongside inflation concerns. However, potential interest rate hike expectations could counteract some of these effects.

US Dollar Strength Faces Challenges Amid Fed Comments and Weak Manufacturing Data

On the US front, the US Dollar is strengthening as US Treasury yields improve, amid risk-off market sentiment. However, the gains in the US dollar could be short-lived as Federal Reserve (Fed) officials suggested that the central bank could meet its 2% annual inflation target without further interest rate hikes.

Atlanta Fed President Raphael Bostic stated in an interview that he doesn't see the need for more rate hikes to achieve the target. Similarly, New York Fed President John Williams mentioned that while inflation remains high, it should ease in the latter half of 2024, signaling a cautious approach towards monetary policy adjustments.

On the data front, the ISM Manufacturing PMI unexpectedly fell to 48.7 in May, down from April's 49.2 and below the forecast of 49.6. This marks the second consecutive month of contraction for the US manufacturing sector, with 18 out of the last 19 months showing decline.

Therefore, the US dollar could face challenges despite its recent strength, as Federal Reserve officials hint at holding off on interest rate hikes despite improving Treasury yields. The unexpected drop in the ISM Manufacturing PMI may add to these pressures, impacting the USD and influencing the AUD/USD pair.

AUD/USD - Technical Analysis

The AUD/USD pair is currently trading at $0.66671, reflecting a decline of 0.28% in the 4-hour timeframe. The pivot point at $0.6680 is crucial, serving as a benchmark for potential price movements.

Immediate resistance levels are identified at $0.6709, $0.6735, and $0.6755. These levels indicate where the pair might face upward barriers.

On the support side, immediate support is at $0.6640, followed by $0.6616 and $0.6591. The 50-day Exponential Moving Average (EMA) is positioned at $0.6641, suggesting a near-term support level that traders should monitor closely.

The Relative Strength Index (RSI) is at 54, indicating a neutral market sentiment with a slight leaning towards bullishness.

The current technical setup suggests that the AUD/USD pair might continue to face downward pressure if it fails to break above the pivot point of $0.6680. Given the alignment of the 50 EMA close to the current price, a failure to hold above this level could result in further declines.

The recommended strategy under these conditions is to sell below $0.6680, targeting a take-profit level at $0.6640, with a stop loss at $0.6710.

In conclusion, the outlook for AUD/USD remains bearish below $0.6680. Immediate resistance levels at $0.6709, $0.6735, and $0.6755 could cap any potential upward movements.

On the downside, immediate support at $0.6640 and further levels at $0.6616 and $0.6591 should be monitored closely for signs of continued bearish momentum.

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