AUD/USD Price Analysis: Retreats from 0.6750 as investors anticipate hawkish Fed guidance
|- AUD/USD has sensed selling pressure around 0.6750 as investors have shifted their focus toward the Fed policy.
- As per the consensus, inflation gained at a pace of 1.0% vs. the prior pace of 1.4% on a quarterly basis.
- AUD/USD has sensed selling pressure while attempting to climb above the horizontal resistance plotted around 0.6900
The AUD/USD pair has met stiff resistance near 0.6750 after a less-confident pullback in the late European session. The recovery move in the Aussie asset has faded as investors have turned cautious ahead of the interest rate policy by the Federal Reserve (Fed), which will be announced on July 26.
S&P500 futures have posted significant gains in the London session, portraying ease in the negative market sentiment. The US Dollar Index (DXY) is gathering strength to recapture the intraday high of 101.41 as investors are anticipating that the Fed will hike interest rates on July 26 after skipping in June.
Meanwhile, the Australian Dollar is expected to deliver a power-pack action ahead of the inflation data for the second quarter. As per the consensus, inflation gained at a pace of 1.0% vs. the prior pace of 1.4% on a quarterly basis. Annual Consumer Price Index (CPI) contracted to 6.2% against 7.0% the prior release.
AUD/USD has sensed selling pressure while attempting to climb above the horizontal resistance plotted from June 16 high around 0.6900. The Aussie asset has formed a Double Top chart pattern, which indicates a bearish reversal. The 20-period Exponential Moving Average (EMA) at 0.6758 is acting as a barricade for the Aussie bulls.
The Relative Strength Index (RSI) (14) has slipped below 40.00, which indicates that the downside momentum has been activated.
Going forward, a downside move below the immediate support of 0.6700 would expose the asset toward July 11 low at 0.6650, followed by the round-level support at 0.6600.
On the flip side, a recovery move above July 20 high at 0.6847 would drive the asset toward June 16 high of around 0.6900. Breach of the latter would send the major toward February 16 high at 0.6936.
AUD/USD four-hour chart
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.