Technical Analysis – AUDUSD plummets in the US CPI aftermath
AUDUSD drops 1.7% on hotter-than-expected US CPI data
Violates both 50- and 200-day SMAs before finding its feet
Momentum indicators deteriorate drastically
AUDUSD had been in a steady advance since the beginning of April, posting a fresh one-month high of 0.6643 on Tuesday. However, the pair experienced a strong decline and erased all its progress following a stronger-than-expected US inflation report on Wednesday.
Should the price extend its recent slide, the recent support of 0.6479, which also held strong in February and March, could act as the first line of defence. A violation of that territory could pave the way for the 2024 bottom of 0.6441. Dropping beneath that floor, the pair may descend towards the August 2023 low of 0.6363.
On the flipside, if the pair finds its footing and jumps back above both the 50- and 200- day simple moving averages (SMAs), the bulls could initially target the February resistance of 0.6594. Further upside attempts could cease at the recent one-month peak of 0.6643. Failing to halt there, the price may advance towards the March high of 0.6666.
In brief, AUDUSD underwent a massive retreat on Wednesday but managed to recoup some losses. Therefore, a test of the congested region that includes both its 50- and 200-day SMAs could decide whether the rebound will resume or falter.
Related Assets
Latest News
Disclaimer: The XM Group entities provide execution-only service and access to our Online Trading Facility, permitting a person to view and/or use the content available on or via the website, is not intended to change or expand on this, nor does it change or expand on this. Such access and use are always subject to: (i) Terms and Conditions; (ii) Risk Warnings; and (iii) Full Disclaimer. Such content is therefore provided as no more than general information. Particularly, please be aware that the contents of our Online Trading Facility are neither a solicitation, nor an offer to enter any transactions on the financial markets. Trading on any financial market involves a significant level of risk to your capital.
All material published on our Online Trading Facility is intended for educational/informational purposes only, and does not contain – nor should it be considered as containing – financial, investment tax or trading advice and recommendations; or a record of our trading prices; or an offer of, or solicitation for, a transaction in any financial instruments; or unsolicited financial promotions to you.
Any third-party content, as well as content prepared by XM, such as: opinions, news, research, analyses, prices and other information or links to third-party sites contained on this website are provided on an “as-is” basis, as general market commentary, and do not constitute investment advice. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, it would be considered as marketing communication under the relevant laws and regulations. Please ensure that you have read and understood our Notification on Non-Independent Investment. Research and Risk Warning concerning the foregoing information, which can be accessed here.
