Australian Dollar Price Action: AUD/USD, EUR/AUD, AUD/JPY, GBP/AUD


Australian Dollar Vs US greenback, Japanese Yen, Euro, British Pound – Price Setups:

  • AUD is starting to look oversold in opposition to a few of its friends.
  • EUR/AUD and GBP/AUD are approaching sturdy hurdles.
  • Downward momentum in AUD/JPY is slowing at it nears sturdy cushion.
  • AUD/USD seems to be the weakest of the above.

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Forex for Beginners

As the mud from the CPI knowledge settles, the Australian greenback is starting to look oversold because it approaches essential help in opposition to a few of its friends. While this would not essentially suggest a reversal of the downtrend, it could possibly be sufficient to set off at the very least a short-term pause.

AUD suffered losses throughout the board on Wednesday after Australian inflation eased within the first quarter. The response to the CPI knowledge suggests the market is selecting to concentrate on the inflationtrend, slightly than thepaceof the cool-down. For extra dialogue see “Australian Dollar Off Lows After CPI: What’s Next for AUD/USD?”, printed April 26.

Australia’s CPI rose to 7% on-year within the January-March quarter, Vs 6.9% anticipated from 7.8% within the earlier quarter. However, inflation eased final month to six.3% on-year Vs 6.5% anticipated, down from 6.8% in February. While inflation continues to be working above the central financial institution’s goal band of two%-3%, there’s proof that the rise is slowing. Whether the cool-down in inflation can be sufficient to immediate a pause at RBA’s May assembly is a detailed name.

The Australian central financial institution left rates of interest unchanged at its assembly in early April saying it wished further time to evaluate the spillover of earlier charge hikes on the broader financial system however left the door open for extra tightening. “It was important to be clear that monetary policy may need to be tightened at subsequent meetings”, mentioned the minutes of the RBA April 4 assembly. The market is pricing within the RBA Cash Rate at 3.64% by August (Vs 3.6% now), up from 3.72% simply earlier than Wednesday’s CPI knowledge.

Meanwhile, AUD’s slide is starting to look stretched within the close to time period, in accordance with technical charts.

EUR/AUD Weekly Chart

Chart Created Using TradingView

EUR/AUD – Roadblock forward

EUR/AUD is approaching fairly a stiff barrier on the October 2020 excessive of 1.6825, roughly coinciding with the higher fringe of a rising channel from mid-2022. The 14-week Relative Strength Index (RSI) is now in overbought territory, elevating the possibilities of at the very least some consolidation given the tempo and the extent of the rise for the reason that begin of 2023.

GBP/AUD Weekly Chart


Chart Created Using TradingView

GBP/AUD: Overbought situations rising

GBP/AUD is trying equally overbought – the 14-week RSI is nearing the important thing 70-mark. Previous situations of RSI round 70 have been related to a turnaround in GBP/AUD. This is very necessary now because the cross is nearing a tricky hurdle on a horizontal trendline from 2021, at about 1.9150.

AUD/JPY Weekly Chart


Chart Created Using TradingView

AUD/JPY: Downward momentum is slowing

AUD/JPY stays in a bearish mode since final yr, however the downtrend is shedding steam. Momentum is clearly slowing as AUD/JPY has made new lows – see the weekly chart with the Moving Average Convergence Divergence indicator. However, AUD/JPY has fairly a powerful converged cushion which could possibly be powerful to crack at the very least within the first try. This consists of the decrease fringe of the Ichimoku cloud on the weekly chart, the 89-week transferring common, and a horizontal trendline from 2021 at about 85.75.

AUD/USD Daily Chart


Chart Created Using TradingView

AUD/USD: No respite but

Perhaps of the above, AUD/USD seems to be the weakest. The rebound in March/April was feeble, ultimately stalling on the 38.2% retracement of the February-March decline. AUD/USD is now testing an important ground on a horizontal trendline from the tip of 2022 at about 0.6575. Any break under may pave the way in which towards 0.6520 adopted by 0.6385, roughly the goal of the minor double-top sample (the April highs).

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— Written by Manish Jaradi, Strategist for

— Contact and comply with Jaradi on Twitter: @JaradiManish

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