**Australian Dollar Price Action: Setups in AUD/USD, AUD/NZD, and AUD/JPY**
*By David Cottle. Additional insights provided for a comprehensive outlook.*
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The Australian dollar (AUD) stands as one of the most widely traded currencies, often serving as a barometer for global risk sentiment and commodity market trends. In 2024, the Aussie entered a period of dynamic price movement across several major pairs, particularly with the US dollar (USD), New Zealand dollar (NZD), and Japanese yen (JPY). This in-depth analysis surveys recent developments across these pairs, examining both technical and fundamental influences to better understand the near- and medium-term outlook for the AUD. The analysis draws from David Cottle’s original report and supplements these insights with commentary based on data through mid-2024.
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## Fundamental Backdrop
The Australian dollar’s trajectory is shaped by a combination of global and domestic factors:
– **Global Risk Appetite:** The AUD typically strengthens in risk-on market environments, given its association with commodities and emerging markets.
– **Commodity Prices:** Since Australia is a key exporter of iron ore, coal, and natural gas, swings in commodity markets directly impact the currency. In early to mid-2024, commodity prices remained robust, lending some support.
– **Interest Rate Differentials:** Divergences in monetary policy between the Reserve Bank of Australia (RBA) and other major central banks, particularly the Federal Reserve (Fed) and the Bank of Japan (BoJ), remain crucial to AUD pairs.
– **Chinese Demand:** As China’s largest trade partner, Australian economic prospects—and by extension the AUD—are heavily influenced by conditions in the Chinese economy, especially trends in manufacturing and infrastructure.
– **Domestic Indicators:** Australian employment, inflation, and GDP growth reports have been closely scrutinized for clues regarding the ongoing normalization of RBA policy.
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## Technical Setups Across Major AUD Pairs
### AUD/USD: Bearish Channel Remains in Focus
The AUD/USD, often termed the “Aussie,” historically exhibits sensitivity to changes in Federal Reserve policy, US yields, and risk sentiment.
#### Chart Overview
– The currency pair has been confined within a multi-month bearish channel, marked by a series of lower highs and lower lows.
– Recent attempts to break higher have, so far, been capped by resistance near the upper boundary of this channel, suggesting that sellers continue to control the narrative.
#### Key Technical Levels
– **Support:** The channel’s lower boundary converges around the 0.6570-0.6600 range, having provided a consistent floor during dips.
– **Resistance:** The top of the channel and the psychologically significant 0.6700 level remain immediate hurdles.
– **Moving Averages:** The 50-day simple moving average (SMA) currently resides near 0.6650, serving as a dynamic resistance.
– **Trendline Analysis:** Repeated rejections at trendline resistance point towards persistent bearish
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