AUD/USD Forecast: Weak USD Aiding Aussie to Reach 0.7050
AUD/USD Daily Outlooks

AUD/USD Forecast: Weak USD Aiding Aussie to Reach 0.7050

  • The Federal Reserve’s benchmark funds rate is expected to peak at 3.5% in 2023.
  • Investors expect a drop in consumer confidence in the US economy.
  • In the charts, the price is pushing higher within a range.

Today’s AUD/USD forecast is bullish as the risk-sensitive pair could push higher with increased market risk sentiment. The US dollar pushed below 104 on Tuesday morning as bets on US interest rate hikes went down. Investors now expect the Federal Reserve’s benchmark funds rate to peak at around 3.5% next year, down from a previous expectation of 4%.

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However, this recent decline in the dollar might not last, with global growth uncertainties still plaguing investors.

“Stay long the dollar until some of the uncertainty has been reduced. The dollar will fall, likely only when the global economy is on a more sustainable growth path. Markets are forward-looking, but all we can see ahead today in danger,” said Societe Generale strategist Kit Juckes.

AUD/USD key events today

Investors will be expecting data from the US and Australia later today. In the US, investors expect a drop in the Conference Board consumer confidence figure from 106.4 to 100.4. This data measures consumer confidence in economic activity and is a leading indicator of consumer spending. Consumer optimism is expected to go down in the US.

A higher-than-expected reading could push AUD/USD lower. The opposite is also true.

From Australia, investors are awaiting the retail sales figure for May. It is expected to drop from 0.9% to 0.4%. This data is also a significant indicator of consumer spending and overall economic activity.

AUD/USD technical forecast: Short-term bulls aiming at 0.7050

AUD/USD forecast

Looking at the 4-hour chart, we see the price edging slightly higher in the range. The price is currently trading above the 30-SMA, showing bulls are in control. RSI is trading above 50, favoring bullish momentum. The price is caught between 0.70509 and 0.68668. The 0.70509 has acted as resistance, while the 0.68668 has acted as support.

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With the current bullish momentum, the price might be heading toward resistance. A break above this resistance would start a series of higher highs and higher lows, confirming a bullish trend. However, if resistance holds, we could see the price retesting support and possibly breaking below.

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Saqib Iqbal

Saqib Iqbal

Saqib Iqbal is a market analyst, prop fund trader and mentor, serving the industry with his analysis and educational content since 2011. The author has great exposure to different financial markets and institutions. He's well-known for his day trading reviews and multiple timeframe analysis.