AUD/USD Forecast: Corrective decline around the corner

Valeria Bednarik FXStreet

AUD/USD Current Price: 0.6523

Chinese data failed to impress, weighing on the commodity-linked currency.
Manufacturing activity in Australia expected to have contracted in April.
AUD/USD easing from recent highs, at risk of extending its slide.

The AUD/USD pair is ending Thursday with modest losses in the 0.6510 price zone, after hitting a daily high of 0.6569. Chinese data released in the previous Asian session failed to impress, as te NBS Manufacturing PMI came in at 50.8 in April, below the 51 expected. The non-manufacturing PMI resulted at 53.2, better than the previous 52.3. Finally, the Caixin Manufacturing PMI resulted at 49.4 from 50.1 previously. Throughout the last trading session of the day, the Aussie was weighed by the sour tone of equities, giving up despite broad dollar’s weakness.

This Friday, Australia will release the AIG Performance of Manufacturing Index for April, previously at 53.7, and the Commonwealth Bank Manufacturing PMI for the same month, at 45.6 in March. Later in the session, the country will release March HIA New Home Sales and Q1 PPI.

AUD/USD short-term technical outlook

The AUD/USD pair is neutral in the short-term, slowly gaining some bearish potential. The 4-hour chart shows that the price is currently pressuring the 20 SMA, which partially lost strength upward, but holds above the larger ones. The Momentum indicator eases, nearing its mid-line, while the RSI erased overbought conditions to stabilise around 59.

Support levels: 0.6480 0.6445 0.6405

Resistance levels: 0.6580 0.6610 0.6640

View Live Chart for the AUD/USD

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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