The AUD/USD pair is facing downward pressure around the 0.6650 level, coinciding with the 55-day SMA and 61.8% Fibo retracement. Despite two days of gains, the pair traded defensively on Wednesday.
Breaking above the key 200-day SMA at 0.6597 could signal a more positive outlook for AUD/USD, supporting a short-term uptrend continuation.
The pair’s retreat was driven by lower commodity prices, especially in copper and iron ore, due to weak demand and high supply. Additionally, China’s disappointing credit data added to market sentiment concerns.
Investor confidence in the Australian dollar was boosted by the RBA’s decision to keep the OCR steady at 4.35%, with a cautious stance on inflation. RBA Governor Bullock emphasized no immediate rate cuts, signaling a potential delay in reaching the inflation target range.
While the Fed’s potential easing could support AUD/USD, China’s economic challenges may hinder the Australian dollar’s recovery. Net shorts on the AUD remained high, reflecting concerns about China’s economic signals.
AUD/USD Short-Term Technical Analysis
Further gains could push AUD/USD towards the August peak at 0.642, with resistance at 0.6798 and 0.6871. Bearish swings may lead to a drop to 0.6347 and 0.6270.
The four-hour chart shows some loss in upside momentum, with immediate resistance at 0.6642 and support at 0.6554 and 0.6347. The RSI is around 55, indicating a neutral stance.
Overall, AUD/USD faces resistance near 0.6650 amid weaker commodity prices and cautious RBA policy. Traders should monitor key levels for potential breakout opportunities.