9.2 FPG Australian dollar trend analysis

AUDUSD H4

Although inflation in australia has declined somewhat, it still exceeds expectations. The data to a certain extent continues to support the hawkish remarks of the RBA, but dispels the expectation that the RBA may raise interest rates. After the data was released, the four major banks had differing views, with only CBA believing that the RBA may implement a rate cut plan within the year, while the other three all believed that the plan would be delayed until the first or second quarter of 2025. Australia's inflation still remains significantly higher than other economies, which also makes Australia possibly the last central bank to end the previous rate hike cycle and maintain high interest rates, adjusting the main central bank of interest rate policies. The strengthening of the US dollar due to better-than-expected PCE data on Friday has caused the Australian dollar to start to decline. Currently, the market has only reduced its expectation of a 50BP rate cut by the Fed in September, but the current trend in the market is still to urgently lower interest rates by 50BP, and the market needs to find more clues in the data before the interest rate decision. This week, Australia's second quarter GDP and US ADP non-farm payroll data will be released on Wednesday, the Fed's Beige Book on Thursday, and US non-farm payroll data and unemployment rate on Friday. These data will have a significant short-term impact on the Australian dollar.

Technically, the Australian dollar fell from the high of 0.681 on Friday to the support near the low of 0.675, and hit the low point of the week. However, the price near the low point was quickly supported and pulled up. Overall, the Australian dollar ended the strong uptrend of the past three weeks and closed last week with volatility. Looking at a larger time frame, the Australian dollar has been declining from the high point in 2021, and the current distance from the previous high of 0.687 is not large, with many resistance levels.

The upper resistance levels are 0.680, 0.681, and 0.682.

The first support level is at 0.675, the second support level is at 0.673, and the third support level is at 0.671.

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