Australian Dollar Short-term Outlook: AUD/USD Bears Go for the Break

Australian Dollar Technical Outlook: AUD/USD Short-term Trade Levels

AUD/USD plunges 6.2% off yearly high- now testing multi-month uptrend support
Australian Dollar risk for exhaustion / price inflection- US CPI, retail sales on tap
Resistance 6582-6600, 6630s, 6677 (key)– Support 6475/97, 6433, ~6362

The Australian Dollar plunged more than 2.5% off the post-election highs with AUD/USD now threatening a break below multi-month uptrend support. The battle lines are drawn as Aussie tests the last line of defense for the bulls. These are the updated targets an invalidation levels that matter on the AUD/USD short-term technical charts.

Review my latest Weekly Strategy Webinar for an in-depth breakdown of this AUD/USD technical setup and more. Join live on Monday’s at 8:30am EST.

Australian Dollar Price Chart – AUD/USD Daily

Chart Prepared by Michael Boutros, Sr. Technical Strategist; AUD/USD on TradingView

Technical Outlook: In last month’s Australian Dollar Short-term Outlook we noted that four-week decline was approaching support at the 200-day moving average and that, “rallies would need to be limited by 6700 IF price is heading for a break lower with a close below 6575 needed to fuel the next leg.” Aussie broke lower two-days later with price rebounding off confluent support on election day – the post-election rally failed at the median-line (high registered at 6688) before reversing sharply lower with AUD/USD once again approaching trend support today. The focus is on a possible reaction into slope support (blue) with a break / close below needed to keep the immediate short-bias viable.

Australian Dollar Price Chart – AUD/USD 240min

Chart Prepared by Michael Boutros, Sr. Technical Strategist; AUD/USD on TradingView

Notes: A closer look at Aussie price action shows AUD/USD approaching slope support today in early US trade. A break below this slope exposes the last line of defense for the bulls at 6475/97- a region defined by the 78.6% retracement of the yearly range and the 2024 low-day close (LDC). A close below this threshold would be needed to validate a breakout of the August uptrend- such a scenario would keep the focus on subsequent support objectives at the April LDC at 6433 and the 2022 trendline / April low near 6362.

Initial resistance is eyed at the objective monthly open (6582) backed closely by the 66-handle- A topside breach / close above this level would be needed alleviate further downside pressure with subsequent resistance objectives eyed with the 200-day moving average (currently ~6630s) and the 38.2% retracement at 6677. Ultimately a breach / close above the median-line would be needed to suggest a more significant low is place (bearish invalidation).

Bottom line: The Aussie sell-off is now approaching multi-month uptrend support and we’re on the lookout for possible exhaustion / price inflection here. From a trading standpoint, look to reduce portions of short-exposure / lower protective stops on a stretch toward the 6500 – rallies should be limited to the monthly open IF price is heading for a break with a close below 6475 needed to fuel the next leg of the decline.

Keep in mind we get key US inflation data (CPI) and Australian employment tomorrow with US retail sales on tap Friday. Stay nimble into the releases and watch the weekly close here for guidance. Review my latest Australian Dollar Weekly Forecast for a closer look at the longer-term AUD/USD technical trade levels.

AUD/USD Key Economic Data Releases

Economic Calendar - latest economic developments and upcoming event risk.

Active Short-term Technical Charts

Written by Michael Boutros, Sr Technical Strategist with FOREX.com

Follow Michael on X @MBForex

StoneX Europe Ltd makes no representation or warranty and assumes no liability as to the accuracy or completeness of the information provided, nor any loss arising from any investment based on a recommendation, forecast or other information supplied. You should always seek independent advice as to your suitability to speculate in any related markets and your ability to assume the associated risks, if you are at all unsure. We are not under any obligation to update any such material. Any opinion made may be personal to the author and may not reflect the opinion of StoneX Europe Ltd.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 76% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Please ensure you fully understand the risks involved by reading our full risk warning.

FOREX.com is a trading name of StoneX Europe Limited, and FOREX.com/ie is a domain operated by StoneX Europe Ltd, a member of StoneX Group Inc. StoneX Europe Ltd, is a Cyprus Investment Firm (CIF) company registered to the Department of Registrar of Companies and Official Receiver with a Registration Number HE409708, and authorized and regulated by the Cyprus Securities & Exchange Commission (CySEC) under license number 400/21. StoneX Europe is a Member of the Investor Compensation Fund (ICF) and has its registered address at Nikokreontos 2, 5th Floor, 1066 Nicosia, Cyprus.

StoneX Europe Limited is registered with the German Federal Financial Supervisory Authority (BaFin). BaFin registration ID: 10160255

FOREX.com is a trademark of StoneX Europe Ltd, a member of StoneX Group Inc.

The statistical data and the awards received refer to the Global FOREX.com brand.

This website uses cookies to provide you with the very best experience and to know you better. By visiting our website with your browser set to allow cookies, you consent to our use of cookies as described in our Privacy Policy.

Through passporting, StoneX Europe is allowed to provide its services and products on a cross-border basis to the following European Economic Area ("EEA") states: Austria, Bulgaria, Croatia, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Liechtenstein, Lithuania, Luxembourg, Malta, Netherlands, Norway, Poland, Portugal, Romania, Slovakia, Slovenia, Spain, Sweden.

Additionally, StoneX Europe Ltd is allowed to provide Investment and Ancillary Services to the following non-EU jurisdiction: Switzerland.

StoneX Europe Ltd products, services and information are not intended for residents other than the ones stated above.

Tied Agent Information: KQ Markets Europe Ltd with Company No. HE427857.
Address: Athalassas 62, Mezzanine, Strovolos, Nicosia Cyprus.
Services Provided: Reception and Transmission of Orders.
Commencement Date: 06/12/2022
Website: KQ Markets - CFD Trading | KQ Markets

We may pay inducements, such as commissions or fees, to affiliates or third-party introducers for referring clients to us. This is in line with regulatory guidelines and fully disclosed where applicable.

StoneX Europe Ltd may make third party material available on this website which may contain information included but not limited to the conditions of financial markets. The material is for information purposes only and does not contain, and should not be construed as containing, investment advice and/or investment recommendation and/or an investment research and/or an offer of or solicitation for any transactions in financial instruments; any decision to enter into a specific transaction shall be made by the client following an assessment by him/her of their situation. StoneX Europe Ltd makes no representation or warranty and assumes no liability as to the accuracy or completeness of the information provided, nor any loss arising from any investment based on a recommendation, forecast or other information supplied. You should always seek independent advice as to your suitability to speculate in any related markets and your ability to assume the associated risks, if you are at all unsure. We are not under any obligation to update any such material. Any opinion made may be personal to the author and may not reflect the opinion of StoneX Europe Ltd.