**AUD/USD Weekly Analysis and Outlook**
*Adapted and expanded from ActionForex’s technical weekly report, with supplementary information and analysis.*
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### Overview of the AUD/USD Performance
During the past week, the Australian Dollar (AUD) faced renewed selling pressure against the US Dollar (USD), resulting in a clear breakdown from previously observed support levels. The currency pair’s failure to sustain above interim support has changed the near-term technical outlook. Traders are now observing for further potential downside as risk sentiment, central bank policy expectations, and upcoming economic data remain at the forefront of driving this major forex pair.
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### Recap of Recent Price Movements
– The AUD/USD pair declined significantly during the previous week, decisively breaking through a key horizontal support region.
– The week closed at a lower level, cementing a bearish tone for the near term.
– The latest round of selling aligns with risk-off sentiment on global markets and the strengthening of the US Dollar in response to shifting Federal Reserve expectations.
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### Technical Analysis
#### Current Structure
– **Support and Resistance Levels**:
– Immediate next support appears at 0.6574, the low observed on May 31.
– Below this, a break could further expose the 0.6461 mark, representing the swing low from April.
– On the resistance side, the 0.6713-0.6717 zone is now seen as initial resistance after the breakdown. This area now functions as a ceiling for price action pending a reversal.
– Above this, the 0.6870 zone becomes the next key resistance, representing previous highs.
– **Trend Indicators**:
– Daily and weekly moving averages indicate negative momentum, especially after failing to reclaim the 55-day Exponential Moving Average.
– The Relative Strength Index (RSI) is tilting bearish but has not yet reached oversold conditions.
– **Chart Patterns**:
– The pair’s recent slide invalidated the short-term base forming above 0.6713, setting the stage for further declines.
– On the weekly chart, price action remains within a broad range capped on the upside by resistance near 0.6870 and supported in the medium term down to 0.6361.
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### Fundamental Drivers
#### Factors Pressuring AUD
– **Weak Domestic Data**:
– Australian economic releases have generally trended on the weaker side. Recent prints for GDP growth, retail sales, and labor market data have underwhelmed expectations.
– The softer outlook diminishes the likelihood of further rate hikes from the Reserve Bank of Australia (RBA).
– **Central Bank Divergence**:
– Markets have pared back bets on RBA rate increases, while the US Federal Reserve maintains a relatively hawkish bias due to persistent inflation in the US economy.
– This central bank divergence has bolstered USD strength at the expense of the AUD.
#### Global Risk Sentiment
– General risk-off movements in
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