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AUD/USD Price Forecast: Shows resilience below 38.2% Fibo. near mid-0.7100s

  • AUD/USD kicks off the new week on a weak note as Middle East jitters and Fed hike bets lift the USD.
  • Hawkish RBA expectations offer some support to the Aussie and help limit deeper losses for the pair.
  • The bearish technical setup suggests that the path of least resistance for spot prices is to the downside.

The AUD/USD pair touches a one-and-a-half-week low, around the 0.7140 region during the Asian session on Monday, though it lacks follow-through. Spot prices currently trade just above mid-0.7100s, down nearly 0.25% for the day.

The US inflation figures, released last week, reaffirmed market bets for an imminent interest rate hike by the US Federal Reserve (Fed) later this week. Apart from this, rising geopolitical tensions stemming from the US-Iran standoff and clashes in the Strait of Hormuz underpin the safe-haven US Dollar (USD), which, in turn, is seen weighing on the AUD/USD pair. However, hawkish Reserve Bank of Australia (RBA) expectations help limit the downside for the Aussie.

From a technical perspective, last week's breakdown below the 100-period Simple Moving Average (SMA) on the 4-hour chart was seen as a key trigger for AUD/USD bears. The subsequent fall, however, showed some resilience below the 23.6% Fibonacci retracement at 0.7150, warranting some caution before positioning for further losses as the Relative Strength Index (RSI) near 30 hints at oversold conditions that could slow the downside rather than trigger an immediate reversal.

Meanwhile, the Moving Average Convergence Divergence (MACD) indicator stays negative, reinforcing fading momentum in the latest slide. Hence, acceptance below the 23.6% retracement should pave the way for a deeper fall to the 38.2% Fibo. at 0.7095 and the 50% retracement at 0.7051. The said levels mark progressively stronger demand zones if selling resumes.

On the topside, immediate resistance emerges at the 100-period SMA at 0.7179, with a subsequent barrier at the recent cycle high near 0.7239. Only a sustained break above this upper band would ease the current bearish tone.

(The technical analysis of this story was written with the help of an AI tool. Know more.)

AUD/USD 4-hour chart

Chart Analysis AUD/USD

US Dollar Price Last 7 Days

The table below shows the percentage change of US Dollar (USD) against listed major currencies last 7 days. US Dollar was the strongest against the New Zealand Dollar.

USDEURGBPJPYCADAUDNZDCHF
USD0.32%0.07%-1.22%0.29%0.65%1.59%1.09%
EUR-0.32%-0.25%-1.50%-0.02%0.36%1.30%0.77%
GBP-0.07%0.25%-1.37%0.22%0.58%1.55%1.02%
JPY1.22%1.50%1.37%1.59%1.94%2.89%2.36%
CAD-0.29%0.02%-0.22%-1.59%0.41%1.32%0.79%
AUD-0.65%-0.36%-0.58%-1.94%-0.41%0.94%0.42%
NZD-1.59%-1.30%-1.55%-2.89%-1.32%-0.94%-0.52%
CHF-1.09%-0.77%-1.02%-2.36%-0.79%-0.42%0.52%

The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the US Dollar from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent USD (base)/JPY (quote).

Author

Haresh Menghani

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

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