AUD/USD Forecast: Back to the lower end of the range

Valeria Bednarik FXStreet

AUD/USD Current Price: 0.7730

Australian May Consumer Inflation Expectations are foreseen at 3.6%.
Falling equities and gold on higher US inflation pressured AUD/USD.
AUD/USD has room to extend its slide, mainly on a break below 0.7690.

The AUD/USD pair edged sharply lower to end the day in the 0.7730 price zone, its lowest in over a week. The pair pierced the 0.7800 threshold earlier in the day, undermined by the sour tone of Asian and European indexes, with the decline accelerating after the release of US inflation figures. US indexes were also sharply lower, maintaining the pair under pressure in the last trading session of the day.

The greenback’s strength dragged gold prices lower, which added to the AUD/USD bearish case. Australia didn’t publish macroeconomic data on Wednesday but will release May Consumer Inflation Expectations during the upcoming Asian session, foreseen at 3.6% from 3.2% in the previous month.

AUD/USD short-term technical outlook

The AUD/USD pair has decelerated its decline as it neared the base of its comfort zone. The 4-hour chart shows that it has fallen below its 20 and 100 SMAs, with the shorter one slowly turning south. Technical indicators reached oversold readings, holding nearby without signs of bearish exhaustion. The pair could accelerate its decline on a break below the 0.7690 support level.

Support levels: 0.7720 0.7690 0.7650

Resistance levels: 0.7776 0.7820 0.7860

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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