AUD/USD Price Analysis: Bulls struggle to make it through 0.6300 confluence ahead of US CPI – by hareshmenghani AUDUSD Technical Analysis Currencies Fed Inflation
lowest level since April 2020. Currently placed around the 0.6300 round-figure mark, a modest US dollar weakness turns out to be a key factor offering support to the major.
A recovery in the global risk sentiment - as depicted by a generally positive tone around the equity markets - undermines the safe-haven buck and benefits the risk-sensitive aussie. That said, hawkish Fed expectations should act as a tailwind for the greenback and cap gains for the AUD/USD pair ahead of the crucial US CPI report, due later during the early North American session.
From a technical perspective, the uptick could be attributed to some short-covering move amid slightly oversold conditions and ahead of the key data risk. The 0.6300 confluence, comprising 100-hour SMA and the 23.6% retracement level of the recent fall from the 0.6540-0.6550 supply zone, continues to cap the upside. This should now act as a pivotal point for intraday traders.to the next relevant resistance near the 0.6330 region en route to the 38.2% Fibo. level, around the 0.6355 zone. Some follow-through buying should pave the way for additional gains and allow bulls to reclaim the 0.6400 mark. The latter represents another confluence comprising 200-hour SMA and 50% Fibo. level.
On the flip side, the 0.6250 horizontal zone is likely to protect the immediate downside ahead of the YTD low, around the 0.6235 region. This is followed by the 0.6200 round-figure mark, which if broken decisively will be seen as a fresh trigger for bearish traders. This, in turn, will set the stage for an extension of a well-established downtrend witnessed over the past six months or so.