Key Highlights
- AUD/USD is showing bearish signs below the 0.6660 resistance.
- It traded below a contracting triangle with support near 0.6610 on the 4-hour chart.
- EUR/USD could extend losses below the 1.0750 level.
- GBP/USD might be volatile as it approaches the UK CPI report.
AUD/USD Technical Analysis
The Aussie dollar started a fresh decline from well above 0.6700 against the US Dollar. AUD/USD traded below the 0.6660 support to move into a bearish zone.
Looking at the 4-hour chart, the pair settled below the 0.6660 level, the 100 simple moving average (red, 4 hours), and the 200 simple moving average (green, 4 hours).
It even traded below the 0.6620 support level. Besides, AUD/USD traded below a contracting triangle with support near 0.6610 on the same chart. A low is formed near 0.6585 and the pair is now consolidating losses.
Immediate resistance is near the 0.6620 level. The next major resistance is near 0.6675 and the 200 simple moving average (green, 4 hours), above which the pair could rise toward the 0.6700 level.
Any more gains might send AUD/USD toward the 0.6750 level. On the downside, the pair might find support near 0.6600. The next major support is near the 0.6580 level.
If there is a downside break below the 0.6580 level, the pair could decline toward the 0.6500 support level. The next major support sits near the 0.6440 level.
Looking at EUR/USD, the pair is still trading in a bearish zone and there is a risk of a move toward the 1.0700 level in the near term.
Economic Releases
- UK Consumer Price Index for April 2023 (YoY) – Forecast +8.2%, versus +10.1% previous.
- UK Core Consumer Price Index for April 2023 (YoY) – Forecast +6.2%, versus +6.2% previous.
- German IFO Business Climate Index for May 2023 – Forecast 93.0, versus 93.6 previous.
