Key Highlights

  • The Aussie Dollar declined heavily after it failed to surpass the 0.7300 resistance against the US Dollar.
  • There was a break below a crucial triangle support at 0.7210 on the 4-hours chart of AUD/USD.
  • The NFIB Business Optimism Index in Jan 2019 declined from 104.4 to 101.2.
  • Today in the US, the CPI figure for Jan 2019 will be released, which could increase 1.5% (YoY).

AUDUSD Technical Analysis

After a solid rally, the Aussie Dollar found resistance near the 0.7300 area against the US Dollar. The AUD/USD pair declined heavily and traded below the 0.7200 and 0.7120 support levels.

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Looking at the 4-hours chart, the pair even broke the 0.7100 support and settled well below the 100 (red) simple moving average (4-hours). A new monthly low was formed at 0.7053 and later the pair started a short-term upside correction.

It traded towards the 0.7120 resistance and the 23.6% Fib retracement level of the recent decline from the 0.7264 high to 0.7053 low. If buyers succeed in gaining strength above 0.7120, the pair could correct higher towards the 0.7150 resistance zone.

The main resistance is near 0.7160 and the 50% Fib retracement level of the recent decline from the 0.7264 high to 0.7053 low. On the downside, the key support is at 0.7050, below which the pair could revisit the 0.7000 support area.

Recently in the US, the NFIB Business Optimism Index for Jan 2019 was released. The market was looking for a minor decline in the index from 104.4 to 103.2.

However, the result was disappointing as the NFIB Business Optimism Index declined to 101.2 in Jan 2019, which is the lowest since the weeks leading up to the 2016 elections.

There were corrective upward moves in EUR/USD, GBP/USD and AUD/USD, but all these pairs are still trading in a bearish zone and facing crucial resistances.

Economic Releases to Watch Today

  • UK Consumer Price Index Jan 2019 (YoY) – Forecast +1.9%, versus +2.1% previous.
  • UK Core Consumer Price Index Jan 2019 (YoY) – Forecast +1.9%, versus +1.9% previous.
  • US Consumer Price Index Jan 2019 (MoM) – Forecast +0.1%, versus -0.1% previous.
  • US Consumer Price Index Jan 2019 (YoY) – Forecast +1.5%, versus +1.9% previous.
  • US Consumer Price Index Ex Food & Energy Jan 2019 (YoY) – Forecast +2.1%, versus +2.2% previous.

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