AUD/USD Forecast: Bearish bias, holding around 0.7500

Valeria Bednarik FXStreet

AUD/USD Current Price: 0.7497

The US dollar outperform even as US yields decline and as Wall Street rose.
Lockdowns in Australia weighed on the Aussie.
AUD/USD remains under pressure, oversold reading and the 0.7500 area favor a consolidation ahead.

The AUD/USD fell for the third day in a row on Wednesday and approached the post FOMC low. On American hours, the pair bottomed at 0.7491 and then stabilized around 0.7500. The US dollar rose across the board in the final trading day of June while the Aussie continues on a soft note as Sydney and other Australian cities are under lockdowns after outbreaks of the Delta variant.

Earlier on Wednesday, Chinese economic data and a pause in the dollar’s strength favored a modest recovery of AUD/USD to 0.7530. The move higher was shorted-lived and it resumed the downside as the greenback kept its positive tone after the release of US data. Economic reports due in Australia on Thursday include June’s AiG Performance Manufacturing Index, and May’s trade balance. Also of importance will be the Chinese Caixin Manufacturing PMI for June. US Jobless claims and ISM Manufacturing will work as a preview for Friday’s official employment report.

AUD/USD short-term technical outlook

From a technical perspective, the chart continues to favor the downside in AUD/USD. The magnitude of the decline and the support between 0.7480 and 0.7500 should favor some consolation before the next move, as significant weakness is needed to break lower. The RSI is flat at 70, and the 20-SMA turned decisively south. A recovery above 0.7540 should point to a potential short-term low.

Support levels: 0.7475 0.7460 0.7420

Resistance levels: 0.7510 0.7560 0.7605

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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