- The AUD/USD outlook shows the pair edging lower amid a firm greenback.
- Deputy Gov. Hauser and Assistant Gov. Jones maintained a cautious RBA policy stance.
- Traders await commentary from FOMC officials for further policy cues.
The AUD/USD outlook shows a slight bearish momentum, as it trades near 0.6535, consolidating amid a lifted US dollar and a cautious RBA policy stance. The greenback strengthened as markets witnessed increased optimism about the end of the federal shutdown, expected this week.
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The Senate has passed the funding bill, and the House is expected to vote today, followed by President Trump’s approval. The delayed key economic releases are expected to be released as the government reopens. The Dollar Index (DXY) stands at 99.50 after breaking its five-day decline. Meanwhile, the markets are pricing in a 68% probability of a 25 bps December rate cut, which limits the dollar’s upside momentum.
From Australia, the AUD weakened as it faced domestic headwinds despite the RBA’s cautious stance on easing. Deputy Governor Hauser and Assistant Governor Jones acknowledge the need of restrictive policy. Hauser opined that for now, the policy needs to remain tight.
Jones cautioned that the markets are underestimating the increasing geopolitical risks and current global financial complacency. Although the strong Westpac Consumer Confidence and rising investor housing loans underscore resilience, they raise overheating concerns in property markets. Meanwhile, China’s moderate CPI data recovery fails to offer much support to the Aussie.
AUD/USD Daily Key Events
The major events in the day include:
- FOMC Member Williams Speaks
- FOMC Member Miran Speaks
- FOMC Member Paulson Speaks
- FOMC Member Bostic Speaks
- FOMC Member Waller Speaks
- CB Leading Index M/M
On Wednesday, traders look forward to comments from FOMC officials and the CB leading index (M/M) for further directional bias.
AUD/USD Technical Outlook: 200-MA Capping Gains
The AUD/USD 4-hour chart shows a cautious bullish bias, as it trades near 0.6535 after its previous losses near 0.6470. The price remains consolidating near the 200-period MA. The 20- and 50-period MAs have formed bullish crossover, increasing odds for an upside.
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The RSI is at 59, reflecting a bullish strength. Meanwhile, the 0.6540 level acts as a dynamic resistance zone, as it aligns with the 200-MA. A breach above this level could make room for further upside near 0.6600. Contrarily, a failure to hold above 0.6540 could trigger a fresh selling wave.
Support Levels
Resistance Levels
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