AUD/USD Forecast: Aussie retreats after testing monthly high

Valeria Bednarik FXStreet

AUD/USD Current Price: 0.7305

Australia to publish this Wednesday Q3 Wage Price Index and the Westpac Leading Index.
The poor performance of equities limited the bullish potential of the AUD.
AUD/USD could be developing a double top figure, the neckline stands at 0.7221.

The AUD/USD pair advanced to 0.7339 this Tuesday, where it also topped earlier this month. Now trading around 0.7300, the Australian dollar was undermined by the soft tone of European and American indexes, although the latest ones managed to trim part of their intraday losses.

Early in Asia, the Reserve Bank of Australia published the Minutes of its latest meeting, which showed that the central bank is ready to provide more stimulus if needed after cutting rates to a record low of 0.1%. Policymakers repeated that they expect to keep the cash rate at the current level for the foreseeable future. RBA’s Governor Philip Lowe is scheduled to speak this Wednesday. The Australian calendar includes the October Westpac Leading Index and Q3 Wage Price Index data.

AUD/USD short-term technical outlook

The AUD/USD pair retains its positive stance in the near-term but lacks a catalyst strong enough to push it higher. A possible double top is underway, that would be confirmed on a break below 0.7220. Meanwhile, the 4-hour chart shows that it keeps developing above a mildly bullish 20 SMA, while the larger moving averages keep advancing below it. Technical indicators corrected overbought conditions but stabilized well into positive territory, indicating limited selling interest.

Support levels: 0.7290 0.7250 0.7210

Resistance levels: 0.7345 0.7380 0.7420

View Live Chart for the AUD/USD

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Author

Valeria Bednarik

FXStreet

Valeria Bednarik was born and lives in Buenos Aires, Argentina. Her passion for math and numbers pushed her into studying economics in her younger years.

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