AUD/USD Price Bears to Hold Under 0.7400 Despite US CPI

• The US inflation figures could shake the markets and could bring new opportunities.
• AUD/USD maintains a bearish bias as long as it stays within the descending pitchfork’s body.
• Breaking down from the current range could signal further downside movement.

The AUD/USD price dropped after yesterday’s minor rebound as the Dollar Index stays higher. The outlook is bearish, so it could resume its decline anytime. Its located deep in the seller’s territory, so further drop is favored.

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Still, we’ll have to wait for the US inflation data to come out before deciding the next move. The CPI, Consumer Price Index, is expected to register a 0.5% growth in July versus 0.9% in June, while the Core CPI is expected to increase by 0.4% compared to the 0.9% growth in June.

More than expected, the inflation growth may help the USD increase as the Federal Reserve could be forced to hike rates in its upcoming meetings. Worse than expected figures could weaken the greenback, which could depreciate versus its rivals.

The Aussie has slipped lower as the Australian Westpac Consumer Sentiment dropped by 4.4% in August versus 1.5% growth in July.

AUD/USD price technical analysis: More fall to follow-through

The AUD/USD price is located below the descending pitchfork’s median line (ML). The outlook is bearish after escaping from the ascending channel pattern. Technically, it’s still trapped within a range pattern.

After several false breakouts above 0.7413, the AUD/USD pair has turned to the downside again. Personally, I’m expecting to see sharp movements later. A valid breakdown below 0.73 and below 0.7289 may signal further decline.

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On the other hand, a valid breakout above 0.7369 could signal that the short term’s AUD/USD price could increase. A larger upwards movement could be signaled and validated by an upside breakout from this range.

The upside 50% Fibonacci line of the descending pitchfork is seen as a dynamic resistance. The target’s major downside support is seen at the descending pitchfork’s lower median line (LML).

From the technical point of view, the AUD/USD pair could develop an upside reversal only if it makes a valid breakout above the upper median line (UML). Unfortunately, this scenario is far from being achieved, so the bearish bias remains intact.

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