Australian Dollar Forecast: AUD/USD Halts Bearish Price Series
AUD/USD halts the recent series of lower highs and lows as it rebounds from a fresh weekly low (0.6408).
Written by
David Song
Strategist
Australian Dollar Outlook: AUD/USD
AUD/USD halts the recent series of lower highs and lows as it rebounds from a fresh weekly low (0.6408).
Australian Dollar Forecast: AUD/USD Halts Bearish Price Series
Keep in mind, AUD/USD cleared the December high (0.6515) earlier this week as it registered a fresh yearly high (0.6537), and the exchange rate may attempt to retrace the decline from the November high (0.6688) should it continue to defend the V-shape recovery from last month.
Australia Economic Calendar
Looking ahead, the update to Australia’s Retail Sales report may sway AUD/USD as household spending is expected to increase another 0.3% in April, and a positive development may push the Reserve Bank of Australia (RBA) to the sidelines following the decision to lower the cash rate by 25bp earlier this month.
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In turn, signs of a robust economy may fuel the recent rebound in AUD/USD as it curbs speculation for another RBA rate-cut, but a weaker-than-expected Retail Sales report may drag on the Australian Dollar as it puts pressure on Governor Michele Bullock and Co. to further unwind its restrictive policy.
With that said, AUD/USD may consolidate going into the end of May should it fail to defend the advance from the weekly low (0.6408), but the exchange rate may continue to defend the V-shape recovery from April as it bounces back ahead of the monthly low (0.6357).
AUD/USD Price Chart – Daily
Chart Prepared by David Song, Senior Strategist; AUD/USD on TradingView
- AUD/USD bounces back ahead of the monthly low (0.6357) to snap the bearish price series from earlier this week, and the exchange rate may stage a larger rebound amid the failed attempt to close below 0.6410 (50% Fibonacci extension).
- Need a close above the 0.6510 (38.2% Fibonacci retracement) to 0.6520 (38.2% Fibonacci extension) region to bring 0.6590 (38.2% Fibonacci extension) on the radar, with the next area of interest coming in around November high (0.6688).
- At the same time, a close below 0.6410 (50% Fibonacci extension) may lead to a test of the monthly low (0.6357), with the next area of interest coming in around 0.6240 (61.8% Fibonacci extension).
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--- Written by David Song, Senior Strategist
Follow on X at @DavidJSong
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