Current trend

The AUD/USD pair is declining, trading at 0.6575 and continuing the development of the “bearish” corrective trend formed yesterday after a retreat from the local highs.

Reserve Bank of Australia (RBA) officials kept the interest rate at 4.35%, justifying it by high inflation, which is falling more slowly than expected. The April TD Securities consumer price index fell from 3.8% to 3.7% YoY and amounted to 0.1% MoM. Representatives of the regulator did not specify further steps to adjust monetary policy, and against this uncertainty, the AUD/USD pair dropped to 0.6575.

The long-term trend remains downward with a key resistance area of 0.6657–0.6629. This week, the price is declining from 0.6629 to the support level of 0.6490, and after a breakdown, the next targets will be 0.6450 and the April low of 0.6355. After a breakout of the resistance area of 0.6657–0.6629, the trend reverses upwards, and long positions with the target at the December high of 0.6859 are relevant.

The medium-term trend is upward. Last week, the quotes approached zone 2 (0.6666–0.6652) but entered a correction that could reach the trend border of 0.6502–0.6488, after testing which long positions with the target at last week’s high of 0.6641 are relevant. After a breakout of zone 2, growth to zone 3 (0.6811–0.6797) is expected.

Support and resistance

Resistance levels: 0.6629, 0.6657, 0.6750.

Support levels: 0.6490, 0.6450, 0.6355.

Trading tips

Long positions may be opened above 0.6655, with the target at 0.6750 and stop loss 0.6615. Implementation time: 9–12 days.

Short positions may be opened below 0.6535, with the target at 0.6450 and stop loss 0.6575.