AUDUSD Technical Analysis – Awaiting the NFP

<p>US:</p><ul><li>The Fed <a href="https://www.forexlive.com/centralbank/federal-reserve-interest-rate-decision-25-bps-rate-hike-to-525-550-20230726/">hiked by 25 bps</a> as
expected and kept everything unchanged at the last meeting.</li><li>Inflation expectations and CPI readings continue to
show disinflation with the last two <a href="https://www.forexlive.com/news/us-june-cpi-02-mm-versus-02-mm-expected-20230810/">Core CPI M/M</a> figures
coming in at 0.16%. </li><li>The <a href="https://www.forexlive.com/news/us-august-sp-global-services-flash-pmi-510-vs-522-expected-20230823/">US PMIs</a> missed
expectations across the board last week. </li><li>Fed Chair Powell’s speech at the <a href="https://www.forexlive.com/news/jackson-hole-roundup-what-did-the-central-banksters-say-20230828/">Jackson Hole Symposium</a> was
mostly in line with what he said previously but he stressed on the need to be
careful going forward and that continued strength in the labour market may
require further rate hikes. </li><li>The first half of the week saw <a href="https://www.forexlive.com/news/jolts-job-openings-for-july-8827m-versus-9465m-estimate-20230829/">US Job Openings</a> and <a href="https://www.forexlive.com/news/us-august-consumer-confidence-1061-vs-1160-expected-20230829/">Consumer Confidence</a> reports
missing expectations by a big margin, followed by a miss in the <a href="https://www.forexlive.com/news/adp-us-august-employment-177k-vs-195k-expected-20230830/">US ADP</a> data and
a beat in the <a href="https://www.forexlive.com/news/us-initial-jobless-claims-we-26-august-228k-vs-235k-expected-20230831/">US Jobless Claims</a>.</li><li>The market doesn’t expect another hike from the Fed
anymore, but a lot will depend on the data going forward.</li></ul><p>Australia:</p><ul><li>The
RBA <a href="https://www.forexlive.com/news/forexlive-european-fx-news-wrap-aussie-knocked-lower-by-rba-yen-fall-extends-20230801/">kept its cash rate unchanged</a> with a slight tweak to a line in
the policy statement that suggests that they are leaning more on the dovish
side. </li><li>The
<a href="https://www.forexlive.com/centralbank/rba-minutes-credible-path-back-to-cpi-target-with-cash-rate-staying-at-its-present-level-20230815/">RBA Minutes</a> showed that the central bank indeed
prefers to keep the cash rate steady. </li><li>The
data is supporting the RBA’s stance as the Australian <a href="https://www.forexlive.com/news/australia-july-jobs-146k-vs-15k-expected-jobless-rate-37-vs-35-exp-20230817/">jobs</a>, <a href="https://www.forexlive.com/news/australian-wages-data-for-q2-08-qq-expected-10-20230815/">wages</a> and <a href="https://www.forexlive.com/news/australian-q2-headline-cpi-08-qq-vs-10-expected-20230726/">inflation</a> data all missed expectations. </li><li>The
<a href="https://www.forexlive.com/news/manufacturing-services-australian-preliminary-pmis-for-august-remain-in-contraction-20230822/">Australian PMIs</a> also missed expectations remaining
in contraction. </li><li>The
market expects the RBA to hold the cash rate steady in September.</li></ul><p>AUDUSD Technical Analysis –
Daily Timeframe</p><p>On the daily chart, we can see that AUDUSD is
bottoming out around the 0.64 handle and the price is now both above the <a href="https://www.forexlive.com/Education/technical-analysis-support-and-resistance-20220405/">resistance</a> and the
red 21 <a href="https://www.forexlive.com/Education/technical-analysis-understanding-moving-averages-20220425/">moving average</a>. This
might be an early sign of a bigger correction to the upside to come with the
0.66 handle as the first target. On the other hand, a fall below the support may
end up leaving behind a fakeout and trigger a selloff.</p><p>AUDUSD Technical Analysis –
4 hour Timeframe</p><p>On the 4 hour chart, we can see that we had a <a href="https://www.forexlive.com/Education/technical-analysis-understanding-divergence-20220429/">divergence</a> with the
<a href="https://www.forexlive.com/Education/technical-analysis-understanding-macd-20220427/">MACD</a> prior to
the breakout of the <a href="https://www.forexlive.com/Education/technical-analysis-trendlines-20220406/">trendline</a>. This is
generally a sign of weakening momentum often followed by pullbacks or
reversals. In this case, given the break of the trendline, the chances of a
reversal are higher, and the target should be the 0.66 handle. We can see that
the buyers are already stepping in around the 0.6459 support and the red 21
moving average to position for a rally into the resistance. </p><p>AUDUSD Technical Analysis –
1 hour Timeframe</p><p>On the 1 hour chart, we can see that the
0.6459 support has been quite strong as the price reacted to it multiple times
and it’s now bouncing off of it. The price action formed a <a href="https://www.forexlive.com/Education/chart-patterns-guide-20220125/">descending
triangle</a> pattern and generally a breakout on either side leads
to a strong and sustained move. So, if the price breaks to the upside, we can
expect the buyers to pile in and target the 0.66 resistance. Vice versa, if the
price breaks through the support, the sellers will jump in and extend the fall
into new lows. </p><p>Upcoming Events</p><p><a href="https://www.forexlive.com/EconomicCalendar">Today</a> the market will
be focused on the main release of the week: the US NFP report. We will also
have the US ISM Manufacturing PMI an hour and a half later, but the labour
market data is the priority right now. A bad reading is likely to weaken the US
Dollar in the short term, but if the data is really bad, the market may start
to fear the recession and the greenback should come back soon after. A good
reading is likely to be linked with the soft-landing scenario and might be
bearish for the USD as well. Overall, it’s a mixed picture at the moment as the
Fed is expected to pause at the September meeting and we might get much worse
economic data before the next meeting in November. </p>

This article was written by FL Contributors at www.forexlive.com.