- The AUD/USD forecast remains mildly supportive amid the RBA’s cautious outlook.
- Policymakers emphasized a balanced and data-driven approach to future monetary policy in the RBA meeting minutes.
- Markets await factory orders m/m, the NAHB housing market index, and FOMC commentary for further impetus.
The AUD/USD forecast indicates the pair is in a neutral to slightly supportive momentum as it trades near 0.6480. The Aussie is recovering its previous losses amid the RBA’s cautious meeting minutes and mixed US data.
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The RBA minutes revealed a balanced and data-dependent stance from policymakers, suggesting that rates could remain unchanged as long as incoming data proves stronger than expected.
They noted that weakness in growth or labor could trigger monetary easing. Meanwhile, stronger domestic employment data, with October’s unemployment rate down to 4.3% and employment rising by 42.2K, boosted the Aussie, reinforcing expectations for a cautious RBA stance.
From the US, the greenback remained subdued on Tuesday, despite reduced expectations for a December Fed cut. Markets price in a 43% probability of a December cut, down from last week’s 62%. The Dollar Index (DXY) traded lower near 99.50 as traders digested mixed FedSpeak remarks and weak private employment figures.
On Monday, the Fed’s Jefferson noted that, considering the risks to labor markets now exceed the risks of inflation, the Fed should proceed slowly with further monetary easing. Meanwhile, Fed’s Waller favored a rate cut in the upcoming December meeting due to the weak labor market and slowdown in hiring. These developments capped the dollar’s further strength.
AUD/USD Daily Key Events
The significant events in the day include:
- FOMC Member Barr Speaks
- FOMC Member Barkin Speaks
- Factory Orders m/m
- NAHB Housing Market Index
These events are low-impact, but Fed commentary could be a point of traction for the market participants, as shifting rate cut expectations have been pivotal since the shutdown ended.
AUD/USD Technical Forecast: Seller’s Dominance Persists
The AUD/USD 4-hour chart shows sustained bearish momentum, as it trades under 0.6500. The price remains well below the key 50-, 100-, and 200-period MA, zoned between 0.6520 and 0.6550.
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The RSI remains below 40, indicating that sellers are in control and there is weak buying interest. Buyers could challenge the short-term downtrend if price breaks above the 20-MA at 0.6520. However, buyers will need to reclaim above the 200-MA near 0.6550 for a trend reversal. On the contrary, sellers could remain dominant if a drop below 0.6460 occurs, extending the downside towards 0.6435 and 0.6400.
Support Levels
Resistance Levels
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