AUD/USD Forecast: Aussie holds above 0.6520, consolidation to persist

Matías Salord FXStreet

AUD/USD Current Price: 0.6559

Australian PMI shows a deterioration in November.
Low volume amid US holidays is likely to keep price action subdued.
The AUD/USD holds above 0.6520 and below the 200-day SMA.

The AUD/USD rose on Thursday during a quiet session with US markets closed, supported by a weaker US Dollar. The upside was limited, and consolidation is expected to continue until next week.

The Australian Judo Bank Flash Australia Composite PMI dropped in November from 47.6 to 46.4, reaching the lowest level in 27 months. The Services PMI fell to 46.3, the lowest in 26 months, and the Manufacturing PMI declined to 47.7, the lowest in 42 months.

Despite the figures, Warren Hogan, Chief Economic Advisor at Judo Bank, said: "Activity weakened in Australia's services and manufacturing sectors in November. Manufacturing has remained soft for most of 2023, although the sector does not appear to be slipping into recession at this stage."

The AUD/USD pair continued to move with a bullish bias despite the data, supported by a weaker US Dollar. Positive sentiment in global markets weighed on the Greenback. However, trading volume was low due to the holiday in the US. On Friday, activity is also expected to remain subdued. The US S&P Global PMIs are due.

AUD/USD short-term technical outlook

The AUD/USD rose on Thursday after holding above the relevant technical support at 0.6520. It continues to trade between that level and the 200-day Simple Moving Average (SMA) at 0.6590. A daily close well above that line could open the doors to further gains.

On the 4-hour chart, the price is slightly above the 20-SMA, with technical indicators favoring the downside. With limited action ahead, a decline could find support quickly around 0.6540. On the upside, 0.6570 should limit further gains. Price action appears poised to continue moving sideways around current levels ahead of the Asian session.

Support levels: 0.6545 0.6520 0.6485

Resistance levels: 0.6570 0.6590 0.6625

View Live Chart for the AUD/USD

Author

Matías Salord

FXStreet

Matías started in financial markets in 2008, after graduating in Economics. He was trained in chart analysis and then became an educator. He also studied Journalism. He started writing analyses for specialized websites before joining FXStreet.

AUD/USD holds steady above 0.7100 after weak Australian PMIs

AUD/USD remains range-bound around 0.7100 in the Asian session on Wednesday after Australia's flash PMIs showed manufacturing slipped into contraction and services expanding slowly for a second straight month. Furthermore, a bullish US Dollar acts as a headwind for the pair as traders keenly await the crucial Trump-Xi summit on Thursday. Meanwhile, markets shrugs off US-Iran indirect talks.

USD/JPY stands firm near mid-157.00s, close to two-week high

USD/JPY hovers around mid-157.00s in the Asian session on Wednesday, near two-week highs touched last Friday as the BoJ's dovish rate hike continues to undermine the Japanese Yen. Meanwhile, the US Dollar remains firm amid the Fed's hawkish stance, adding support to the pair, though JPY intervention fears cap further gains. Markets pay little heed to the completion of the round of US-Iran indirect talks ahead of Trump-Xi meeting.

Gold struggles near $4,350 as USD strength offsets softer bond yields

Gold struggles to build on the overnight bounce from sub-$4,300 levels and remains defensive in Wednesday's Asian session. The US Dollar sits near its July 30 high amid the Fed's hawkish stance and geopolitical risks, capping the bullion. Meanwhile, the recent decline in Oil prices eases inflation fears, keeping US bond yields depressed and limiting the downside in non-yielding yellow metal.

Bitcoin steadies after strong rally, Ethereum and XRP ease into consolidation

Bitcoin (BTC), Ethereum (ETH), and Ripple (XRP) bulls take a breather mid-week after gains of 6%, 4%, and 13% so far this week. BTC consolidates at $86,300, ETH hovers around $2,751, and XRP is at $1.57. The price action of these top three cryptocurrencies suggests bulls remain in control, although traders may have taken profits after the recent sharp rally.

AI capex enters the Fed's inflation case with October hike pricing past even money

AI capex enters the Fed's inflation case with October hike pricing past even money; UK headroom halved and French CDS at post-2020 wides before either budget lands; Pezeshkian in New York with a Gulf slot scheduled and no Iranian bilateral. Monday priced the same AI buildout at two completely different costs of capital.

BoJ Recap: Not as hawkish as expected

The Bank of Japan (BoJ) raised its short-term interest-rate target to 1.25% from 1.00% in a 7-2 vote, marking another step in the normalisation of monetary policy and widely matching what everyone has been expecting for weeks.