AUD/USD Price Analysis: Tests channel breakdown near 0.6400
- AUD/USD faces selling pressure near 0.6400 as the US Dollar remains resilient.
- Australian Q2 GDP outperformed expectations despite tight interest rate policy.
- AUD/USD tests the breakdown of the sideways channel and is expected to resume its downside journey.
The AUD/USD pair faces selling interest near the round-level resistance of 0.6400 in the late European session. The upside in the Aussie asset remains restricted due to the resilient US Dollar and China’s vulnerable economic outlook.
The Australian Dollar witnessed some buying early Wednesday due to upbeat Gross Domestic Product (GDP) data for the April-June quarter. The economy grew at a steady pace of 0.4%, a higher-than-expected growth rate of 0.3%. On an annualized basis, Q2 GDP dropped to 2.1% from the Q1 growth rate of 2.4% but remained higher than expectations of 1.7%.
Meanwhile, investors await US ISM Services PMI for August, which will be published at 14:00 GMT. Analysts at TD Securities expect the US ISM Services PMI to hold steady at 52.7 in August.
AUD/USD tests the breakdown of the sideways channel near the round-level resistance of 0.6400 on a two-hour scale. The asset remains vulnerable as the 20-period Exponential Moving Average (EMA) near 0.6400 continues to act as a barrier for the Australian Dollar bulls.
The Relative Strength Index (RSI) (14) rebounds into the 40.00-60.00 range while the downside bias remains firmer.
A fresh downside would appear if the Aussie asset dropped below August 17 low around 0.6360. This would expose the asset to the round-level support of 0.6300 followed by 03 November 2022 low at 0.6272.
On the contrary, a recovery move above August 15 high around 0.6522 will drive the asset to August 9 high at 0.6571. Breach of the latter will drive the asset towards August 10 high at 0.6616.
AUD/USD two-hour chart
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Author
Sagar Dua
FXStreet
Sagar Dua is associated with the financial markets from his college days. Along with pursuing post-graduation in Commerce in 2014, he started his markets training with chart analysis.
