Audusd rises 3.4% as focus shifts to US economic data releases

AUDUSD Analysis

Performance after Wednesday
Period	Pct	Chg	Momentum
Wednesday	3.4%	202.2 Pips
Week to-date	1.62%	98 Pips
April	-1.7%	-106.1 Pips

Upcoming key events (London Time)

Thu 01:30 PM USD CPI Inflation Rate (12-mth)
Fri 01:30 PM USD PPI excluding Food and Energy sectors (12-mth)

What happened lately

In the absence of major economic news, the focus shifts to the upcoming high-impact economic data releases from the United States this week. On Thursday, the United States will release its Consumer Price Index (CPI) data, which measures the annual inflation rate. Inflation is a key indicator of economic health, as it affects purchasing power and can influence monetary policy decisions by the Federal Reserve. A higher-than-expected CPI could suggest rising price levels and potentially lead to tighter monetary policy to curb inflation. Conversely, a lower-than-expected figure might imply more subdued inflation, reducing the immediate need for aggressive rate hikes.

On Friday, the Producer Price Index (PPI) excluding the food and energy sectors is set for release. This index measures the average change over time in the selling prices received by domestic producers for their output, excluding volatile food and energy prices. It provides insight into the underlying inflationary pressures faced by producers, potentially signaling future consumer inflation trends. A significant deviation in this data can also impact expectations for the Federal Reserve’s policy direction.

The AUDUSD currency pair rose by 3.4% to 0.61503 on Wednesday, indicating a notable appreciation of the Australian dollar against the US dollar. This movement is significant, suggesting a strengthening of investor sentiment towards the Australian currency or a weakening outlook for the US dollar. The rise could impact the relative competitiveness of Australian exports, as a stronger Australian dollar can make exports more expensive for foreign buyers, potentially impacting Australia’s trade balance.

The upcoming US economic data releases could further influence the AUDUSD pair. If the US CPI and PPI figures come in higher than expected, it might lead to a stronger US dollar as markets anticipate further rate hikes by the Federal Reserve to combat rising inflation. This could reverse some of the recent gains of the Australian dollar against the US dollar. However, if the data suggests weaker inflationary pressures, the US dollar might weaken further, potentially boosting the AUDUSD pair as the relative attractiveness of the Australian dollar increases in the context of global forex markets.

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What can we expect from AUDUSD today?

AUDUSD on Wednesday rose 3.4% to 0.61503. Price is below 9-Day EMA while Stochastic is rising.

Updated daily direction for AUDUSD looks bullish as the pair ended higher after Wednesday trading session.

Looking ahead for the day, immediate upside resistance level is R1 at 0.62463 with break above could target R2 at 0.63422 or figure level area. While towards the downside, we are looking at daily low of 0.59132 as an important support. Break below this level could weaken the current bullish momentum. A break above 0.61757 may suggest continuation after recent positive movement.

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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