Audusd declines amid mixed us economic data influences

AUDUSD Analysis

Performance after Monday
Period	Pct	Chg	Momentum
Monday	-0.15%	-9.4 Pips
Week to-date	-0.15%	-9.4 Pips
December	-4.43%	-288.1 Pips

Upcoming key events (London Time)

No major events for the day.

What happened lately

In the United States, the most recent report from the National Association of Realtors indicated a significant rise in Pending Home Sales for November, which increased to 2.2%, up from a revised 1.8% in October. This positive shift suggests an improvement in the housing market, contrary to the initially reported October figure of 2%. On the other hand, the Chicago Purchasing Managers’ Index (PMI), a vital indicator of economic activity, showed a decline, falling to 36.9 points in December from 40.2 points in November. The drop in the PMI signals a slowdown in manufacturing activity, potentially reflecting broader economic challenges. Both these pieces of data provide a mixed picture of the U.S. economy, with housing showing strength while manufacturing exhibits signs of weakness.

Considering the impact on the AUDUSD currency pair, the decline in the Chicago PMI might weigh negatively on the U.S. dollar. Such a fall typically signals a contraction in the manufacturing sector, potentially weakening investor confidence in the ability of the U.S. economy to expand robustly. On the contrary, the improvement in the Pending Home Sales may provide some support to the dollar, suggesting underlying resilience in the housing market. However, the overall effect on the AUDUSD pair would be nuanced, as the conflicting data points may lead to the pair remaining in a consolidation pattern, as observed with Monday’s drop of 0.15% to 0.62199. Given no major events being slated, the pair’s movement may primarily hinge on broader shifts in market sentiment or unexpected economic developments. The mixed U.S. economic data will likely keep traders cautious, influencing the Australian dollar’s relative attractiveness versus the USD in the short term.

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What can we expect from AUDUSD today?

AUDUSD on Monday dropped -0.15% to 0.62199. Price is below 9-Day EMA while Stochastic is falling in oversold zone.

Updated daily direction for AUDUSD looks mixed as the pair is likely to consolidate above 0.61986 (S1).

Looking ahead today, to see upside interest, we prefer to look at price breakout of last daily high of 0.62467 or trades above daily pivot 0.62227. Break above could target R1 at 0.62439. While to the downside, we are looking at 0.61986 (S1) and daily low of 0.62014 as support levels. AUDUSD need to break on either side to indicate a short-term bias. A close below 0.62014 would indicate selling pressure.

For the week to-date, take note that AUDUSD is mixed as compared to the prior week.

Key levels to watch out:

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