AUD/USD: Bear flag breakdown puts Aussie on the defensive ahead of RBA's Lowe speech

AUD/USD 15-minute chart shows a bear flag breakdown - a bearish continuation pattern.
Dovish comments from RBA's Lowe would only bolster the already bearish technical setup.

Omkar Godbole FXStreet Contributor

The AUD/USD pair fell to 0.7559 - the lowest level since June 1, courtesy of a bearish technical setup.

The 15-minute chart shows a bear flag breakdown - a bearish continuation pattern, which indicates scope for a drop to 0.7520 (target as per the measured height method).

Also, the bear flag breakdown comes after the pair's failure to cut through falling trendline (drawn from Feb. 16 high and March 14 high).

Clearly, the Aussie dollar is on the defensive ahead of RBA Governor Lowe's speech. The central bank head will be speaking later today at an Australian Industry Group event in Melbourne.

The AUD/USD pair risks deeper sell-off if Lowe kills the already low odds of an RBA liftoff. On the other hand, upbeat comments on wage growth and inflation could put a bid under the Aussie dollar. As of writing, the spot is trading at 0.7574.

AUD/USD Technical Levels

Resistance: 0.7584 (resistance on hourly chart), 0.7602 (50-hour MA + 10-day MA), and 0.7624 (previous day's high).

Support: 0.7561 (June 8 low), 0.7544 (38.2% Fib R of May-June rally), 0.7513 (61.8% Fib R of May-June rally).

15-minute chart

Daily chart

Author

Omkar Godbole

FXStreet Contributor

Omkar Godbole, editor and analyst, joined FXStreet after four years as a research analyst at several Indian brokerage companies.

EUR/USD stays well offered below 1.1800

The selling pressure on EUR/USD is picking up pace, with the pair slipping decisively below the key 1.1800 level and sliding to fresh two week lows as Wednesday’s session draws to a close. The move lower comes as the US Dollar finds renewed strength after the latest round of US data and the release of the FOMC Minutes. Next of note on the docket will be the US weekly Initial Jobless Claims.

GBP/USD reaches multi-day lows near 1.3500

GBP/USD reverses its initial upside momentum and is now adding to previous declines, approaching the 1.3500 region on Wednesday. Cable’s downtick comes on the back of decent gains in the Greenback and easing UK inflation figures, which seem to have reinforced the case for a BoE rate cut in March.

Gold battle to regain $5,000 continues

Gold is back on the front foot on Wednesday, shaking off part of the early week softness and challenging two-day highs near the $5,000 mark per troy ounce. The move comes ahead of the FOMC Minutes and is unfolding despite an intense rebound in the US Dollar.

Bitcoin has found or is near a bottom, extended consolidation to follow: K33

Bitcoin (BTC) is nearing or has already established a bottom, which could be followed by a sustained period of slow price movement, according to K33.

Mixed UK inflation data no gamechanger for the Bank of England

Food inflation plunged in January, but service sector price pressure is proving stickier. We continue to expect Bank of England rate cuts in March and June. The latest UK inflation read is a mixed bag for the Bank of England, but we doubt it drastically changes the odds of a March rate cut.

Sui extends sideways action ahead of Grayscale’s GSUI ETF launch

Sui is extending its downtrend for the second consecutive day, trading at 0.95 at the time of writing on Wednesday. The Layer-1 token is down over 16% in February and approximately 34% from the start of the year, aligning with the overall bearish sentiment across the crypto market.