AUD/USD Forecast: Australian data will set the next direction

Valeria Bednarik FXStreet

AUD/USD Current Price: 0.6737

Modest gains in Wall Street maintained AUD/USD afloat ahead of Tuesday’s opening.
Australian Retail Sales are expected to have increased by 1.5% in January.
The AUD/USD pair bounced modestly after testing the 0.6700 threshold.

The AUD/USD pair heads into the Asian opening trading in the 0.6730 price zone, recovering from an early low of 0.6697. The pair fell throughout the first half of the day as a risk-averse environment favored the American Dollar. The Aussie weakened despite upbeat Australian data, as Company Gross Operating Profits were up 10.6% in the last quarter of 2022, recovering from -11.5% in Q3 and beating the 1.5% expected. The positive tone of European indexes helped the pair trim early losses, while modest Wall Street gains maintained AUD/USD afloat.

Australia will release January Retail Sales early on Tuesday, expected to have increased by 1.5% after contracting by 3.9% in the previous month. The country will also publish the Q4 Current Account Balance and January Private Sector Credit.

AUD/USD short-term technical outlook

The daily chart for the AUD/USD pair shows that it briefly slid below a mildly bullish 100 Simple Moving Average (SMA) but ended the day a handful of pips above it. At the same time, the 200 SMA gains downward traction above the current level, while the 20 SMA accelerated south far above the longer one. At the same time, the Momentum indicator resumed its decline within negative levels, while the Relative Strength Index (RSI) indicator consolidates at around 35, maintaining the risk skewed to the downside.

The 4-hour chart shows that the intraday advance falls short of anticipating another leg north. AUD/USD holds below a firmly bearish 20 SMA, providing dynamic resistance at around 0.6770. The longer moving averages also head south above the shorter one, in line with the dominant bearish trend. Finally, technical indicators recovered from their intraday lows but quickly turned flat within negative levels, maintaining the risk skewed to the downside.

Support levels: 0.6700 0.6660 0.6615

Resistance levels: 0.6770 0.6820 0.6865

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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