Contents
The AUD to USD experienced a 0.42% decline on Wednesday, following a 0.75% slide the previous day, closing at $0.67309 after reaching a high of $0.67707 and a low of $0.67018.
Highlights:
- AUD/USD declined by 0.42% on Wednesday, closing at $0.67309, following a 0.75% slide on Tuesday
- Investor focus on Thursday is on China’s Caixin Services PMI, with potential impact on demand for the Australian dollar due to the services sector’s importance in the Chinese economy.
- China, responsible for one-third of Australian exports, could significantly impact the Australian economy and the Aussie dollar if there is a weak demand environment.
- Thursday’s US economic calendar includes crucial data like ADP Nonfarm, Jobless Claims, and Services PMI. Positive labor market data may influence Fed rate decisions, potentially impacting the AUD/USD pair.
Focus on Australian and Chinese Services PMIs
Thursday’s spotlight is on China’s Caixin Services PMI, crucial for the Australian dollar, considering China’s significant role in Australian exports. A contraction in the services sector may impact buyer demand for the Aussie dollar, affecting both the Chinese and Australian economies.
Influence of US Labor Market Data
The US labor market, including ADP employment change and initial jobless claims, will play a pivotal role in shaping short-term AUD/USD trends. Positive US labor market data might prompt a delay in rate cuts, potentially tilting monetary policy in favor of the US dollar.
Short-Term Forecast
Near-term AUD/USD movements are contingent on US labor market data and ISM service sector statistics. A potential monetary policy divergence, coupled with the absence of a substantial stimulus from China, could favor the US dollar.
AUD to USD Price Action Analysis
Examining the daily chart, the AUD/USD maintains a position above the 50-day and 200-day EMAs, suggesting bullish signals. A move above $0.67500 could trigger a challenge of the $0.68096 resistance level. Conversely, breaking below the $0.67286 support level might expose the 50-day EMA and the $0.66162 support level.
AUD to USD Chart Analysis
On the 4-hourly chart, the AUD/USD remains below the 50-day EMA but above the 200-day EMA, signaling a mixed short-term and bullish longer-term outlook. Crossing the 50-day EMA could lead to a test of the $0.68096 resistance level, while breaching the $0.67286 support might bring the 200-day EMA into play.
Read more: AUD/USD Rise: Navigating the Strong Challenges Posed by RBA
Conclusion
Factors such as China’s Services PMI and US labor market data continue to sway the AUD/USD. Traders are advised to closely monitor these variables for insights into potential market movements.
