Current trend

Against neutral dynamics of the American dollar, the AUD/USD pair is correcting upwards around 0.6599 amid a positive reaction of investors to macroeconomic statistics.

Thus, the Q2 Australian wage price index added 0.8% QoQ and 4.1% YoY, while in the private sector, the indicator corrected by 0.7%, reaching the December 2021 low compared to 0.9% earlier. As a result, annual wage growth in the private sector, amounting to 4.1%, became the lowest after three consecutive periods of maintaining at 4.2%, above 3.9% last year. Thus, the pace is slowing down again, acting as an obstacle to the country’s economic growth.

The American dollar is trading at 102.90 in USDX. The July producer price index is due out today. It may rise 0.2% MoM, slowing the pace of growth to 2.3% from 2.6% YoY, signaling a contraction in the headline consumer price index due on Wednesday at 14:30 (GMT 2). The CPI is currently expected to rise from –0.1% to 0.2% MoM and remain at 3.0% YoY, with the core value may change from 0.1% to 0.2% MoM and from 3.3% to 3.2% YoY, confirming the likelihood of significant monetary easing this year.

Support and resistance

On the daily chart, the trading instrument is correcting, retreating from the support line of the Expanding formation pattern with dynamic boundaries of 0.6810–0.6310.

Technical indicators are slowing down the sell signal: fast EMA on the Alligator indicator are approaching the signal line, narrowing the range of fluctuations, and the AO histogram is increasing in the sell zone.

Resistance levels: 0.6620, 0.6700.

Support levels: 0.6570, 0.6470.

Trading tips

Long positions may be opened after the price rises and consolidates above 0.6620, with the target at 0.6700. Stop loss — 0.6590. Implementation period: 7 days or more.

Short positions may be opened after the price falls and consolidates below 0.6570, with the target at 0.6470. Stop loss – 0.6600.