Analysis of AUD/USD: Exchange Rate Falls to Early May Low
Analysis of AUD/USD: Exchange Rate Falls to Early May Low
As indicated by the 4-hour AUD/USD chart today:
→ the rate fell below 0.652, a level last seen on May 2;
→ the RSI indicator dropped below 15, a level last seen during the panic over the spread of COVID-19 in spring 2020.
The weakening of the Australian dollar could be linked to participants' expectations of upcoming news:
→ the US Core PCE Price Index will be published today at 15:30 GMT+3;
→ next week, Australian inflation data and the Federal Reserve's interest rate decision (both events scheduled for Wednesday) will be released.
Is further decline in the AUD/USD rate possible?
It is possible that the release of significant news could trigger a surge in volatility, causing the AUD/USD rate to fall below the recent monthly low of 0.652.
However, technical analysis of the AUD/USD chart suggests a potential recovery scenario:
→ The sequence of local extremes in the first half of 2024 forms a structure resembling a narrowing triangle. It appears the central axis is around 0.0665, and the bounce from low B indicates support from the Support 1 line.
→ Therefore, it is reasonable to assume that, in the context of increased volatility in the forex market, the AUD/USD rate has significantly deviated from the average values around 0.0665. At current quotes, some participants might want to lock in profits from short positions and/or position themselves for a short-term recovery of the "Aussie" from the oversold zone, following a 4% drop from A to B in 10 days.
This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.
As indicated by the 4-hour AUD/USD chart today:
→ the rate fell below 0.652, a level last seen on May 2;
→ the RSI indicator dropped below 15, a level last seen during the panic over the spread of COVID-19 in spring 2020.
The weakening of the Australian dollar could be linked to participants' expectations of upcoming news:
→ the US Core PCE Price Index will be published today at 15:30 GMT+3;
→ next week, Australian inflation data and the Federal Reserve's interest rate decision (both events scheduled for Wednesday) will be released.
Is further decline in the AUD/USD rate possible?
It is possible that the release of significant news could trigger a surge in volatility, causing the AUD/USD rate to fall below the recent monthly low of 0.652.
However, technical analysis of the AUD/USD chart suggests a potential recovery scenario:
→ The sequence of local extremes in the first half of 2024 forms a structure resembling a narrowing triangle. It appears the central axis is around 0.0665, and the bounce from low B indicates support from the Support 1 line.
→ Therefore, it is reasonable to assume that, in the context of increased volatility in the forex market, the AUD/USD rate has significantly deviated from the average values around 0.0665. At current quotes, some participants might want to lock in profits from short positions and/or position themselves for a short-term recovery of the "Aussie" from the oversold zone, following a 4% drop from A to B in 10 days.
This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.
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