Current trend

The AUD/USD pair broke through the support level of 0.6538 and is trading at 0.6515 after the publication of negative Australian macroeconomic statistics.

Thus, the Q4 volume of completed construction work decreased from 1.3% to 0.7%, below the forecast of 0.8%, and the consumer price index for January amounted to 3.4% compared to preliminary estimates of 3.6%. With inflation falling, the Reserve Bank of Australia (RBA) may leave interest rates unchanged at its next meeting on March 19. The national currency received some support from media reports citing Trade Minister Don Farrell that China could lift increased tariffs on Australian wine exports in March, which would be a significant step towards normalizing trade relations and supporting the economy.

The American dollar is strengthening amid the rhetoric of representatives of the US Federal Reserve: yesterday, board member Michelle Bowman said that she was ready to increase the cost of borrowing if inflation slowed down or began to decline. Thus, if the indicator approached the target of 2.0%, the movement to the “dovish” rhetoric to prevent excessive tightening of monetary policy was possible. In turn, the head of the Federal Reserve Bank (FRB) of Kansas City, Jeffrey Schmid, said that since price growth significantly exceeded the target value, the labor market remained strong, and demand was stable, there was no point in adjusting interest rates. He asked market participants to “be patient”, confirming the continued risks of accelerated inflation due to shipping problems in the Red Sea, which could contribute to higher costs of consumer goods.

Support and resistance

The long-term trend is downwards: as part of the correction that began on February 14, the price overcame the resistance level of 0.6538 but failed to reach the next level of 0.6616 and returned to 0.6538, which acts as a support level. The negative dynamics are likely to continue with the target at the February low of 0.6447, after which the next target will be 0.6353.

The medium-term trend is downward: last week, as part of the correction, the quotes reached the key trend resistance of 0.6602–0.6587 and began to decline with the target at 0.6449, where the main sales target is zone 3 (0.6436–0.6421).

Resistance levels: 0.6538, 0.6616, 0.6675.

Support levels: 0.6447, 0.6353.

Trading tips

Short positions may be opened from 0.6538, with the target at 0.6447 and stop loss 0.6570. Implementation time: 9–12 days.

Long positions may be opened above 0.6570, with the target at 0.6675 and stop loss 0.6530.