• The AUD/USD remains positive in the week, up by 0.70%.
  • China’s Premier Li Keqiang warned that the economy could not achieve its goals, weighing on the AUD/USD.
  • AUD/USD Price Forecast: Tilted to the downside and might have peaked around 0.7100.

The AUD/USD is almost flat during the North American session after trading in a 0.7057 low to 0.7109 high trading range, amid a risk-on market mood that keeps US equities buoyant while safe-haven assets retraced. At 0.7090, the AUD/USD is poised to finish the day with minimal gains.

Sentiment remains positive after Wednesday’s release of the Federal Reserve’s May meeting minutes. The US central bank stated that all participants agreed to rate raises of 50 bps in the next couple of meetings and mentioned that they need to move “expeditiously” to a neutral posture. Also, officials said they would remain focused on inflationary pressures, much In line with the Fed speaking rhetoric, since May 5.

Meanwhile, the US Dollar Index slumps some 0.20% during the North American session, sitting at 101.877, opening the door for a fall towards April 21 daily low at 99.818. US Treasury yields recovered some ground, led by the 10-year benchmark note, which appears to have bottomed just shy of the 50-day moving average (DMA), and is gaining two basis points, sitting at 2.768%.

During the Asian session, China’s Premier Li Keqiang sound the alarm about the slowing economy. He made comments to local officials in an emergency meeting. He said that growth risks were slipping below a “reasonable” range and warned that China would face a much longer road to recovery if the economy doesn’t keep expanding at a certain rate.

Those remarks put a lid on the AUD/USD, which was headed to record a fresh weekly high above the current one at 0.7127, eyeing a test of March’s 15 swing low at 0.7165.

Regarding US macroeconomic data, the docket featured Gross Domestic Product (GDP) preliminary figures for the first quarter, which showed a contraction of 1.5% YoY, much larger than the -1.3% expected. Trade dynamics weighed on the readings, as Exports fell at a 5.4% pace in Q1, while Imports skyrocketed 18.3%. Nonetheless, consumer spending increased by 3.1% vs. estimations of 2.7% YoY. Also, the Labor Department reported Initial Jobless Claims for the week that ended on May 20, which rose 210K, lower than the 215K foreseen.

The Australian economic docket would feature Retail Sales on its preliminary reading, foreseen at 0.9% MoM on Friday. On the US front, the economic docket would reveal the Fed’s favorite measurement for Inflation, the Personal Consumption Expenditure (PCE), foreseen at 6.4%, triple the US central bank objective.

AUD/USD Price Forecast: Technical outlook

The AUD/USD remains downward biased in the mid to long term. In the short term, the 20-day moving average (DMA), spotted at 0.7034, suggests the major is trending higher, but it’s worth noting that the four-day rally was capped at the 0.7100 figure, meaning that it might be ending. Further confirmation was provided by oscillators, which are trending lower within a bearish territory.

That said, the AUD/USD first support would be the 20-DMA at 0.7034. A break below would expose the May 18 cycle low at 0.69490, followed by the YTD low at 0.6828.

Key Technical Levels

AUD/USD

Overview
Today last price 0.7090
Today Daily Change -0.0002
Today Daily Change % -0.03
Today daily open 0.7094
 
Trends
Daily SMA20 0.7037
Daily SMA50 0.7267
Daily SMA100 0.7232
Daily SMA200 0.726
 
Levels
Previous Daily High 0.712
Previous Daily Low 0.7034
Previous Weekly High 0.7074
Previous Weekly Low 0.6872
Previous Monthly High 0.7662
Previous Monthly Low 0.7054
Daily Fibonacci 38.2% 0.7067
Daily Fibonacci 61.8% 0.7087
Daily Pivot Point S1 0.7046
Daily Pivot Point S2 0.6997
Daily Pivot Point S3 0.696
Daily Pivot Point R1 0.7131
Daily Pivot Point R2 0.7168
Daily Pivot Point R3 0.7217

 

 

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

EUR/USD steadies near 1.0550, looks to post modest weekly gains

EUR/USD steadies near 1.0550, looks to post modest weekly gains

EUR/USD has lost its bullish momentum after having climbed above 1.0570 with the initial reaction to the US data in the American session and retreated toward the mid-1.0500s. On a weekly basis, the pair remains on track to close in positive territory. 

EUR/USD News

GBP/USD struggles to hold above 1.2300

GBP/USD struggles to hold above 1.2300

GBP/USD has edged lower following a jump above 1.2300 in the early American session on Friday. The market mood remains upbeat ahead of the weekend with Wall Street's main indexes posting strong daily gains on upbeat US data. 

GBP/USD News

Gold stays below $1,830 as US yields edge higher

Gold stays below $1,830 as US yields edge higher

Gold continues to fluctuate below $1,830 on Friday and looks to close the second straight week in negative territory. Fueled by the risk-positive market environment, the benchmark 10-year US Treasury bond yield is up more than 1% on the day, limiting XAU/USD's upside.

Gold News

Why Cardano could surprise over the weekend

Why Cardano could surprise over the weekend

ADA  set to close out the week with a gain on the workday trading week and over the weekend? Central banks signaled that the rate hike cycle is ending, meaning less stress and tight conditions for trading, opening up room for some upside potential with Cardano set to pop above $0.55 and test a significant cap.

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