• Despite US inflation reaching the highest level since 1982, the greenback weakens.
  • AUD/USD traders faded the downward reaction followed by a 90-pip rally, from 0.7140 to 0.7250.
  • Treasury yields rise, led by the 10-year benchmark note, piercing the 2.00% threshold.

The AUD/USD advances sharply following the release of US inflation data, which rose the highest since 1982. At the time of writing, the AUD/USD is trading at 0.7237 for a gain of 0.77%.

Before Wall Street opened, the Department of Labor released January Consumer Price Index (CPI) figures, which showed prices increased 7.5%, higher than the 7.3% foreseen on annual figures. Excluding volatile items like food and energy, the so-called Core CPI broke the 6% threshold, higher than the 5.9% estimations.

Market’s reaction

On the release, the AUD/USD dipped as low as the S1 daily pivot at 0.7147, followed by a jump of 80-pips so far, approaching the 100-day moving average (DMA) at 0.7247. The US 10-year Treasury yield reached the 2% mark, advancing six basis points.

In the meantime, the US Dollar Index, a gauge of the greenback’s value against a basket of its peers, has fallen 0.17%, to sit at 95.33.

During the Asian Pacific session, the Australian economic docket featured Building Permits on its monthly reading for December, alongside Consumer Inflation Expectations for February. The former came in at 8.2%, as foreseen by market players, while the latter arrived at 4.6% with no forecast. 

In the US, alongside inflation figures, Initial Jobless Claims for the week ending on February 5 rose to 223K, better than the 230K forecasted by economists, while Continuing Jobless Claims stayed unchanged at 1,621K compared to the revision of the previous week.

AUD/USD Price Forecast: Technical outlook

Now that US CPI is in the rearview mirror, the AUD/USD is neutral biased, despite the 90-pip jump in the session. The 50-DMA at 0.7166 is under the spot price, while the 100-DMA and the 200-DMA reside above the spot price, suggesting that the AUD/USD is tilted to the downside.

It is worth noting at time of publication, however, that a five-month-old downsloping trendline, with resistance around 0.7220, witnessed a break, which a daily close above the latter could confirm.

To the upside, the AUD/USD first resistance would be the 100-DMA at 0.7247. A break of that ceiling would expose the January 13 daily high at 0.7313, followed by the 200-DMA at 0.7366.

AUD/USD

Overview
Today last price 0.7237
Today Daily Change 0.0055
Today Daily Change % 0.77
Today daily open 0.7182
 
Trends
Daily SMA20 0.7146
Daily SMA50 0.7165
Daily SMA100 0.725
Daily SMA200 0.7371
 
Levels
Previous Daily High 0.7195
Previous Daily Low 0.714
Previous Weekly High 0.7168
Previous Weekly Low 0.6985
Previous Monthly High 0.7315
Previous Monthly Low 0.6966
Daily Fibonacci 38.2% 0.7174
Daily Fibonacci 61.8% 0.7161
Daily Pivot Point S1 0.715
Daily Pivot Point S2 0.7118
Daily Pivot Point S3 0.7096
Daily Pivot Point R1 0.7205
Daily Pivot Point R2 0.7227
Daily Pivot Point R3 0.7259

 

 

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Feed news Join Telegram

Recommended content


Recommended content

Editors’ Picks

AUD/USD bears flirt with 0.6900 amid recession woes, Aussie Retail Sales, Fed’s Powell eyed

AUD/USD bears flirt with 0.6900 amid recession woes, Aussie Retail Sales, Fed’s Powell eyed

AUD/USD remains depressed around 0.6900, after a two-day downtrend, as traders await key Aussie data during Wednesday’s Asian session. That said, the risk barometer pair refreshed its weekly high before closing in the red for the second consecutive day on Tuesday.

AUD/USD News

EUR/USD: A downside break of an ascending triangle looks imminent at 1.0500

EUR/USD: A downside break of an ascending triangle looks imminent at 1.0500

The EUR/USD pair is juggling in a minor range of 1.0518-1.0531 in the early Tokyo session. The confluence of the Ascending Triangle formation and Inverted Flag has strengthened the greenback bulls.

EUR/USD News

Gold eyes further downside towards $1,800, Fed Chair Powell in focus

Gold eyes further downside towards $1,800, Fed Chair Powell in focus

Gold Price remains on the back foot around $1,820, despite the recent bounce off intraday low. In doing so, the yellow metal prints a three-day downtrend as traders await the week’s key data/events amid a sluggish Asian session on Wednesday.

Gold News

Compound price: You won't believe how high COMP can rally

Compound price: You won't believe how high COMP can rally

Compound's COMP price could be a very favorable digital asset in the coming weeks. This article is meant to inform investors of data excluded on Tradingview's Binance, Coinbase and Kucoin exchanges for reasons that have yet to be explained. 

Read more

FXStreet Premium users exceed expectations

FXStreet Premium users exceed expectations

Tap into our 20 years Forex trading experience and get ahead of the markets. Maximize our actionable content, be part of our community, and chat with our experts. Join FXStreet Premium today!

BECOME PREMIUM

Forex MAJORS

Cryptocurrencies

Signatures