- The US dollar remains lower against the Australian dollar.
- Mixed US economic data was ignored by investors focused on the Fed’s Powell.
- Inflation in Australia is falling, putting pressure on the Reserve Bank of Australia.
The Australian dollar (AUD) It is advancing strongly in the American session amid mixed sentiment sparked by investors preparing for Jerome Powell’s speech for reasons that could give a boost to risk assets or send the US dollar (USD) reeling and strengthening. After hitting a daily low of 0.6670, AUD/USD is trading at 0.6709, up 0.24% from its opening price.
Investors stayed on the sidelines due to Powell’s speech
Wall Street sentiment remains fragile. Investors are bracing for Powell after a series of Federal Reserve officials paved the way for moderating rate hikes and stressed the Fed would not be stopping anytime soon. Speculation about a Fed pivot led to a rally in US stocks, and the dollar weakened, as the US Dollar Index (DXY) fell from around 110,000 to 105,340.
On the currency front, AUD/USD rallied after hitting a November low of 0.6272 and rose towards 0.6800. However, the failure to decisively conquer the latter figure exacerbated a pullback to 0.6600 before consolidating around 0.6600-0.6700.
Meanwhile, on the US economic agenda was ADP’s November job change report, showing that the impact of Fed tightening is finally making a dent in the labor market. The reading was 127,000 new jobs added to the economy, well below estimates. Later, the US Department of Commerce revealed that the US economy in the third quarter grew at a pace of 2.9%, up from 2.6% in its anticipated release, and surpassed the 0.6% contraction of the second quarter.
Softer-than-expected Australian CPI eased pressure on RBA
In the Asian session, the Australian CPI for October rose 6.9% yoy, below forecasts of 7.6%. Other data, such as building permits for October, disappointed investors, falling 6% month-on-month below estimates.
Therefore, AUD/USD remains biased between neutral and bullish, but Jerome Powell’s speech could exert downward pressure if his comments are hawkish. Otherwise, the AUD is expected to continue rising if it recognizes the pace of rate hikes.
AUD/USD Key Technical Levels
|Last price today||0.6709|
|Today I change daily||0.0017|
|Today’s daily change in %||0.25|
|today’s daily opening||0.6688|
|previous daily high||0.6749|
|previous daily low||0.664|
|Previous Weekly High||0.6781|
|previous weekly low||0.6585|
|Previous Monthly High||0.6548|
|Previous monthly minimum||0.617|
|Daily Fibonacci of 38.2%||0.6707|
|Daily Fibonacci of 61.8%||0.6682|
|Daily Pivot Point S1||0.6636|
|Daily Pivot Point S2||0.6584|
|Daily Pivot Point S3||0.6527|
|Daily Pivot Point R1||0.6745|
|Daily Pivot Point R2||0.6801|
|Daily Pivot Point R3||0.6853|
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.