USD

• The Fed left interest rates unchanged as
  expected at the last meeting with a shift in the statement that indicated the
  end of the tightening cycle.
• The Summary of Economic Projections showed a
  downward revision to Growth and Core PCE in 2024 while the Unemployment Rate
  was left unchanged. Moreover, the Dot Plot was revised to show three rate cuts
  in 2024 compared to just two in the last projection.
• Fed Chair Powell didn’t
  push back against the strong dovish pricing and even said that they are focused
  on not making the mistake of holding rates high for too long.
• The latest US CPI
  slightly beat expectations but analysts expect the Core PCE to print at 0.2%
  M/M again following the CPI data.
• The labour market continues to soften although Initial Claims keep on
  hovering around cycle lows while Continuing Claims got stuck at a higher level.
• The latest ISM Manufacturing
  PMI
  beat expectations, while the ISM Services PMI missed
  by a big margin.
• The hawkish Fed members have been leaning
  on a more neutral side lately.
• The market expects the Fed to start cutting rates
  in Q1 2024.

AUD

• The
  RBA left interest rates unchanged as expected at the last meeting with
  the central bank maintaining the usual data dependent language.
• The
  recent Monthly CPI report missed expectations across
  the board which is another welcome development for the RBA.
• The
  latest labour market report beat forecasts across the
  board although the unemployment rate rose more than expected.
• The
  wage price index surprised to the upside as wage
  growth in Australia remains strong.
• The
  Australian PMIs improved recently but remain in
  contraction.
• The
  market expects the RBA to start cutting rates in Q3 2024.

AUDUSD Technical Analysis –
Daily Timeframe

On the daily chart, we can see that AUDUSD continues
to consolidate at a key support zone
around the 0.6670 level where we can also find the 61.8% Fibonacci retracement level
for confluence. The
buyers are likely to keep piling in here with a defined risk below the support
to position for a rally into the 0.69 handle. The sellers, on the other hand,
will want to see the price breaking lower to increase the bearish bets into the
0.65 handle.

AUDUSD Technical Analysis –
4 hour Timeframe

On the 4 hour chart, we can see that the recent
price action has been rangebound as the market remains uncertain where to go
next given the mixed economic data. If the price breaks above the minor trendline we can
expect the buyers to increase the bullish bets into the 0.69 handle while a
break below the support will likely trigger a selloff into the 0.65 level.

AUDUSD Technical Analysis –
1 hour Timeframe

On the 1 hour chart, we can see more
closely the recent price action with no clear level where to lean onto except
the support zone and the minor trendline. The best strategy is generally to sit
out and wait for a breakout supported by a fundamental catalyst, although one
can also “play the range” by buying at support and selling at resistance.

Upcoming Events

Today the only notable event on the agenda is the US
PPI data.

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• Source: https://www.forexlive.com/technical-analysis/audusd-technical-analysis-20240112/