AUD/USD moves steadily towards 0.6650 as USD trims some gains

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  • AUD/USD hit a multi-year low around 0.6574 but bounced back and is gaining 0.29%.
  • The Summary of Economic Projections (SEP) reported that Fed officials see rates around 4.4% by the end of 2022.
  • The US Department of Labor reported that jobless claims increased less than estimated, but exceeded the previous reading.

The AUD/USD bounced away from lows around 0.6574 and back above the key psychological level 0.6600 as the USD weakened following the Fed’s aggressive rate hike which opened the door for further hikes. Although the above would act as support for the USD, AUD/USD rises, trading at 0.6642 at the time of writing.

Global equities continue to slide, posting heavy losses. Central banks around the world continue to tighten monetary conditions amid a period of double-digit inflation in some countries. On Wednesday, the Fed raised rates by 75 basis points. According to the Summary of Economic Projections (SEP), Fed officials estimate further rate hikes of 120 basis points, bringing the Federal Funds Rate (FFR) to around 4.4% by the end of year.

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AUD/USD Recovers on Falling US Dollar

On Thursday, the Labor Department showed US jobless claims for the latest week ending Sept. 17 rose by 213,000, down from an estimated 217,000 but above the previous reading. revised down to 208,000. The number of people receiving benefits after an initial week of aid fell by 22 billion to 1.379 million in the week ending Sept. 10.

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Meanwhile, an absent Australian economic docket left traders to digest the previously released RBA Minutes. The central bank said it was not on a “preset path and would balance out to try to keep the economy in balance.” Furthermore, most RBA board members have begun to consider raising rates at a slower pace as the cash rate rises.

However, analysts at Westpac expect the RBA to rise 50 basis points in October, followed by 25 basis points in November, December and February, raising rates to 3.6%.

What must be considered

On Friday, the Australian economic docket will include the S&P Global manufacturing, services and composite PMIs.

In the US, the S&P global PMIs will also be released along with Fed Chairman Jerome Powell’s speech at around 18:00 GMT.

Technical levels

AUD/USD

Panorama
Last Price Today 0.6639
Today’s Daily Change 0.0010
Today’s Daily Change % 0.15
Today’s Daily Opening 0.6629
Trends
20 Daily SMA 0.6792
50 Daily SMA 0.6884
100 Daily SMA 0.6938
200 Daily SMA 0.71
levels
Previous Daily High 0.6706
Previous Daily Minimum 0.6622
Previous Maximum Weekly 0.6916
Previous Weekly Minimum 0.667
Monthly Prior Maximum 0.7137
Previous Monthly Minimum 0.6835
Daily Fibonacci 38.2% 0.6654
Daily Fibonacci 61.8% 0.6673
Daily Pivot Point S1 0.6599
Daily Pivot Point S2 0.6568
Daily Pivot Point S3 0.6515
Daily Pivot Point R1 0.6683
Daily Pivot Point R2 0.6736
Daily Pivot Point R3 0.6767

Source: Fx Street

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