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AUD/USD Forecast: Retreated From Highs But Retains Its Positive Tone

Valeria Bednarik - Chief Analyst at FXStreet

AUD/USD Current Price: 0.6485

  • Australia to release the April NAB´s Business Confidence index, previously at -66.
  • Chinese inflation expected to recover modestly, still seen deep in the red.
  • AUD/USD retreated from highs but retains its positive tone.

The AUD/USD pair peaked at 0.6560 but ended the day in the red around 0.6480, weighed by the sour tone of equities. Crude oil prices attempted to advance a couple of times throughout the day, but even after Saudi Arabia announced a voluntary cut of 100K barrels per day. Spot gold also eased, nearing $1,690 a troy ounce. Australia will publish this Tuesday the April NAB´s Business Confidence index, previously at -66. China will offer an update on inflation, with the CPI seen down by 2.6% YoY in April.

AUD/USD Short-Term Technical Outlook

The AUD/USD pair retains its positive bias despite ending the day in the red. The 4-hour chart shows that it’s battling with a mild-bullish 20 SMA but holding above the larger ones, as technical indicators corrected overbought conditions to consolidate near neutral levels. Better than anticipated Australian data will likely boost the pair back above the 0.6500 figure, while only below 0.6445, the daily low, the risk will turn to the downside.

Support levels: 0.6445 0.6405  0.6370

Resistance levels: 0.6520 0.6550 0.6590

Image sourced from Pixabay

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