AUD/USD finds support in a key area of interest!
Will this extend the pair's month-long uptrend?
We take a closer look at the 4-hour time frame for clues!
AUD/USD 4-hour Forex chart Chart by TradingView
The second half of May has not been a good month for the AUD/USD pair so far, as it fell from the 0.6700 psychological level to trade near 0.6600 levels after Fed officials focused on their “higher for longer” monetary policy biases.
US dollar trends may change this week as traders focus on the core US PCE price index. If official CPI reports are any guide, we may see the rise in consumer prices slow in April.
Remember that directional biases and volatility conditions in market prices are usually driven by fundamentals. If you haven't done your financial homework on the US and Australian dollars yet, it's time to check the economic calendar and stay up to date with daily essential news!
Focus on potentially weak US inflation data and expectations of strong Australian retail sales data could return the AUD/USD pair to its month-long uptrend.
AUD/USD, which found support at the 0.6600 psychological level near the trend line and 100 SMA support, may see enough demand to revisit previous resistance at 0.6700.
But if the US core PCE price index comes in hotter than expected, or if the Fed's round this week speaks of further backing off interest rate cut bets, the US dollar could extend its gains against the Australian dollar and the AUD/USD could break out. The US dollar is below the trend line.
Don't feel confident taking a directional bias yet? is reading Potential catalysts this week So you'll learn more about what might move the major Forex currencies!