Buying AUDUSD with target of 0.65350 amid Middle East de-escalation

AUDUSD is rising on positive market signals. US President Donald Trump's announcement of de-escalation in Middle East tensions has boosted risk appetite among investors. The Australian dollar, which is highly susceptible to market sentiment, climbed to 0.65. However, the lack of additional confirmation has clouded the currency's outlook.

The situation is complicated by mixed signals from the US Federal Reserve. While Christopher Waller and Michelle Bowman advocate for rate cuts as early as July, Fed Chair Jerome Powell appears determined to maintain current borrowing costs until September. Monetary policy easing typically weighs on the dollar.

Meanwhile, Australia’s business activity is showing positive dynamics, particularly in the services sector. The manufacturing activity is still quite modest, but overall this supports the country’s economy and national currency.

The nearest event likely to impact the quotes is the release of the US economic statistics, including GDP data on June 26.

In Australia, investors are focused on the inflation index publication scheduled for June 25. The CPI is projected to slow down to 2.3% in May, which would support the Reserve Bank of Australia's potential rate cut at its next meeting on July 8. Should the actual figures come in below forecasts, the probability of rate cuts would increase, putting downward pressure on the Australian dollar.

According to the D1 chart, the currency pair has shown significant growth this week. The EMA(20) remains above the EMA(50), indicating a bullish signal. However, it is important to monitor the directions. Even though both EMA(20) and EMA(50) are rising on the chart, the latter is moving slower. So, there might be an uptrend, but not as strong as before. The MACD indicator confirms a short-term trend reversal favoring sellers that occurred on June 17. That day, the MACD line crossed below the signal line, while the MACD histogram began contracting. All these factors point to increasing selling pressure and potential corrective downward movement. However, the rate is now ready to resume its growth.

Current recommendation:

Buying at a breakout above the 0.65 level is advised. Take profit may be set at 0.65350, while Stop loss may be set at 0.64800.