Key Highlights
- AUD/USD climbed above 0.7000 before it corrected lower.
- A key breakout pattern is forming with resistance near 0.6980 on the 4-hours chart.
- EUR/USD is still facing a strong resistance near the 1.0280 level.
- The US Consumer Price Index could increase 8.7% in July 2022 (YoY).
AUD/USD Technical Analysis
The Aussie dollar started a steady increase above the 0.6900 level against the US Dollar. AUD/USD was able to clear the 0.6950 resistance to move into a positive zone.
Looking at the 4-hours chart, the pair was able to close above the 0.6950 level, 100 simple moving average (red, 4-hours), and the 200 simple moving average (green, 4-hours).
There was a clear move above the 0.7000 resistance zone. The pair traded as high as 0.7046 before it started a downside correction. There was a sharp decline below the 0.6950 support but the bulls were active near the 0.6870 level.
The pair is now back above the 0.6940 and eyeing more upsides. On the upside, the pair is facing resistance near the 0.6970 level. There is also a key breakout pattern forming with resistance near 0.6980 on the same chart.
The next major resistance is near the 0.7000 level, above which the pair could accelerate higher. In the stated case, the pair could rise towards the 0.7050 resistance zone in the near term.
On the downside, the first major support is near the 0.6920 level. A downside break below the 0.6920 support might spark more losses. The next major support is near 0.6860. Any more losses might send the pair towards the 0.6800 zone.
Looking at EUR/USD, the pair is still trading in a range and faces a major hurdle near the 1.0280 zone, above which it could accelerate higher.
Economic Releases
- US Consumer Price Index for July 2022 (MoM) – Forecast +0.2%, versus +1.3% previous.
- US Consumer Price Index for July 2022 (YoY) – Forecast +8.7%, versus +9.1% previous.
- US Consumer Price Index Ex Food & Energy for July 2022 (YoY) – Forecast +6.1%, versus +5.9% previous.
