**AUD/USD Continues to Edge Higher, However, Bearish Sentiment Remains Due to Underlying Headwinds**
*Adapted and expanded from “FxWirePro: AUD/USD edges higher, but bearish outlook persists” via EconoTimes. Supplemented with additional analytical insights and references to support the overall outlook.*
—
**Market Background: Recent AUD/USD Movements**
The Australian Dollar (AUD) has shown signs of resilience against the US Dollar (USD) in recent trading sessions. Despite these upward moves, most analysts and technical experts remain cautious, pointing to a bearish longer-term outlook.
– The AUD/USD pair has edged higher in the past 24 hours, driven by a variety of short-term fundamental and technical factors.
– Despite the upward momentum, risks remain skewed to the downside due to macroeconomic and geopolitical uncertainties.
– The currency pair has demonstrated a pattern of moderate gains, followed by corrective moves reflecting changes in risk sentiment and economic data.
—
**Key Drivers of Recent Gains in AUD/USD**
Several short-term factors have contributed to the Aussie dollar’s recent uptick, giving temporary support:
– **Commodity Prices**: Australia’s export-heavy economy is highly sensitive to commodity prices, especially iron ore and coal. A recovery or stabilization in these prices can prompt AUD appreciation.
– **Risk Sentiment**: Global risk appetite, often linked to equity market performance or US-China relations, can cause the AUD/USD pair to move higher as investors seek yield in riskier assets.
– **US Dollar Moves**: Phase-based weakness in the USD, particularly after dovish Federal Reserve communications or softer US macro data, typically lifts AUD/USD.
– **Australian Economic Data**: Occasional positive surprises in key economic indicators, such as GDP, jobs, or trade data, have temporarily boosted the AUD.
—
**Technical Analysis: Bearish Outlook Persists**
Despite the uptick, technical analysis suggests the bearish overall trend is intact. The latest EconoTimes article highlights several technical reasons for such an outlook:
– **Ongoing Downtrend**: The broader movement remains aligned with the longer-term downward channel, as price action struggles to break through significant resistance levels.
– **Moving Averages**: The AUD/USD pair remains below critical moving averages, including both the 100-day and 200-day, reinforcing downward momentum.
– **Relative Strength Index (RSI)**: RSI readings have hovered in neutral territory, but with a bias toward the oversold side, indicating limited scope for a meaningful upside reversal.
– **Resistance and Support Levels**:
– Key Resistance: Near-term resistance is seen at 0.6600 and 0.6650 levels. Any sustained move above these could trigger further short covering.
– Key Support: The most immediate support levels are at 0.6550 and below, at 0.6500. A decisive breach of these could open the way for deeper declines.
– **Candlestick Patterns**: Recent daily candles have shown
Read more on AUD/USD trading.