The AUDUSD currency pair has seen a rapid and continuous rise of 6.94% from 0.59535 on April 9th to 0.63668 yesterday, April 16th. It has now approached the 0.64000 resistance level, below which it has been trading since mid-December 2024. The price previously neared this level in mid-February and March, followed by a pullback and a subsequent downtrend. Now it is April's turn, and the price is again reducing its growth rate and preparing for a reversal.
The Moving Average Convergence and Divergence Indicator (MACD) on the hourly time frame shows a steady decline towards zero. The 4-hour MACD has also charted a path to this level, indicating that the price is preparing for a downward reversal.
The CFTC AUD speculative net positions by April 18 will provide a more accurate picture of investor sentiment. The value of this indicator by April 12 was minus 63,300 contracts, indicating that traders are looking for short positions.
Given the risk of a slowdown in global economic growth, the Reserve Bank of Australia (RBA) is expected to cut rates by 25 basis points at its meetings in May and July. Earlier this month, the RBA kept interest rates unchanged at 4.1%, but said the May meeting would be a good opportunity to review its policy. Either way, the RBA's action is a driver for the Australian dollar, which remains somewhat vulnerable due to its close trade ties with the Chinese economy.
The Federal Reserve (Fed) decided to leave interest rates at 4.25–4.50% in March, reflecting its cautious stance in light of ongoing inflationary pressures. Fed Chairman Jerome Powell noted that the labor market is stable, overall balanced and does not contribute much to price growth.
Trading strategy option: sell at current price with Take Profit at 0.62800 and Stop Loss at 0.64100.
This content is for informational purposes only and is not intended to be investing advice.
