AUD/USD Recovery Stalls Ahead of Monthly High
AUD/USD holds below the monthly high (0.6302) as it struggles to extend the advance from the start of the week.
Share this:
US Dollar Outlook: AUD/USD
AUD/USD holds below the monthly high (0.6302) as it struggles to extend the advance from the start of the week, and the exchange rate may track the negative slope in the 50-Day SMA (0.6338) as it still trades below the moving average.
AUD/USD Recovery Stalls Ahead of Monthly High
AUD/USD may snap the recent series of higher highs and lows should it carve another doji candlestick, and the exchange rate may consolidate ahead of the Federal Reserve interest rate decision on January 29 amid the slew of presidential actions from the Trump administration.
Join David Song for the Weekly Fundamental Market Outlook webinar.
David provides a market overview and takes questions in real-time. Register Here
It remains to be seen if the Federal Open Market Committee (FOMC) will respond to the change in fiscal policy as the central bank forecasts a less restrictive policy for 2025, and expectations for lower US interest rates may produce headwinds for the Greenback as the ‘median participant projects that the appropriate level of the federal funds rate will be 3.9 percent’ at the end of this year.
Nevertheless, the FOMC may adjust its forward guidance as the US economy shows little signs of a recession, and speculation surrounding Fed policy may sway AUD/USD as it remains well below pre-US election rates.
With that said, AUD/USD may struggle to retain the advance from the start of the week if it fails to extend the bullish price series, but the exchange rate may threaten the negative slope in the the negative slope in the 50-Day SMA (0.6338) should it push above the monthly high (0.6302).
AUD/USD Price Chart – Daily
Chart Prepared by David Song, Senior Strategist; AUD/USD on TradingView
- AUD/USD may continue to track the negative slope in the 50-Day SMA (0.6338) as it holds below the monthly high (0.6302), with a move below the 0.6240 (61.8% Fibonacci extension) to 0.6270 (2023 low) zone bringing the monthly low (0.6131) on the radar.
- A break/close below the 0.6130 (23.6% Fibonacci retracement) to 0.6170 (2022 low) region opens up the April 2020 low (0.5980), but AUD/USD may attempt to trade above the moving average for the first time since October should it push above monthly high (0.6302).
- A breach above 0.6318 (November 2023 low) may push AUD/USD towards the 0.6380 (78.6% Fibonacci retracement) to 0.6410 (50% Fibonacci extension) zone, with the next area of interest coming in around the December high (0.6515).
Additional Market Outlooks
EUR/USD Pushes Above 50-Day SMA for First Time Since October
USD/JPY Slips to Fresh Monthly Low Ahead of BoJ Rate Decision
USD/CAD Spikes to Fresh Monthly High as Trump Prepares Canada Tariff
GBP/USD Pullback Pushes RSI Toward Oversold Territory
--- Written by David Song, Senior Strategist
Follow on X at @DavidJSong
Related tags:
The complete CFD trading experience
Award-winning platforms, competitive spreads, low commissions and dedicated support.
We live and breathe the markets and are dedicated to helping traders realise their ambitions as we continue to set the industry bar.
Economic calendar
Web Trader platform
Our sophisticated web-based platform is packed with features.
Related articles
DAX forecast: AI optimism offers relief ahead of central bank meetings
The DAX is finding some relief from the recent improvement in risk appetite, with investors becoming less concerned about the sustainability of the AI trade
Gold outlook: XAU/USD holds above key support ahead of FOMC
Gold forecast hangs in the balance as the metal is clinging to $4,000 ahead of the Fed, but higher oil prices and firm yields are making it hard for the metal to turn its rebound into a sustained rally. But can that change soon?
RBA rate hike bets surge as Australian inflation heats up
Australia's inflation problem extends well beyond energy, with markets now pricing further RBA hikes into 2027. So why has AUD/USD reversed sharply after its initial surge?
StoneX Europe Ltd may make third party material available on this website which may contain information included but not limited to the conditions of financial markets. The material is for information purposes only and does not contain, and should not be construed as containing, investment advice and/or investment recommendation and/or an investment research and/or an offer of or solicitation for any transactions in financial instruments; any decision to enter into a specific transaction shall be made by the client following an assessment by him/her of their situation.
StoneX Europe Ltd makes no representation or warranty and assumes no liability as to the accuracy or completeness of the information provided, nor any loss arising from any investment based on a recommendation, forecast or other information supplied. You should always seek independent advice as to your suitability to speculate in any related markets and your ability to assume the associated risks, if you are at all unsure. We are not under any obligation to update any such material. Any opinion made may be personal to the author and may not reflect the opinion of StoneX Europe Ltd.