#AUDUSD @ 0.67428 struggled around 0.6800 and dropped towards its daily lows below 0.6730s, losses 0.86%. (Pivot Orderbook analysis)

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• AUD/USD struggled around 0.6800 and dropped towards its daily lows below 0.6730s, losses 0.86%.
• Last week’s US inflation data and the Consumer Price Index on Tuesday underpin the US Dollar.
• AUD/USD traders eye Australia’s Business Confidence and Conditions ahead of the US CPI.

The pair currently trades last at 0.67428.

The previous day high was 0.6814 while the previous day low was 0.6744. The daily 38.2% Fib levels comes at 0.6787, expected to provide resistance. Similarly, the daily 61.8% fib level is at 0.677, expected to provide resistance.

The Australian Dollar (AUD) snapped three days of gains and dropped 0.84%, following last Friday’s US producer’s inflation data, ahead of the release of the Consumer Price Index (CPI) in the United States (US). An upbeat sentiment that usually bolsters the AUD/USD keeps the AUD pressured. Therefore, the AUD/USD is trading at 0.6735 after hitting a daily high, shy of the 0.6800 figure.

Risk appetite improved, as shown by US equities rising. The lack of economic data from the US and Australia kept investors digging into last week’s US economic data. The Department of Labor revealed last Friday that the Producer Price Index (PPI) rose for three consecutive months, exceeding expectations on an annual base. At 7.4% year-over-year and 6.2%, excluding food and energy prices, such figures indicate inflation being stubbornly stickier than expected. Also, the consumer sentiment improved to 59.1 from 56 .8 according to the University of Michigan’s data released Friday, although inflation projections dropped slightly, with one-year horizon forecasts dropping to 4.6% from 4.9%.

The US Consumer Price Index (CPI) could be a catalyst in determining the AUD/USD pair direction. The CPI is expected to decrease from 7.7% YoY to 7.3%, while core CPI is foreseen to fall from 6.3% to 6%. If findings indicate cooling inflation conditions, it may result in the US Dollar weakening further.

The Australian side’s lack of economic data leaves the AUD adrift to market sentiment and China’s developments. Despite re-opening many areas in China, investors remain cautious about making decisions with uncertainties surrounding how rising Covid cases could affect economic activity. Recently, Chinese authorities have taken steps such as shutting down their tracking app and removing all “at risk” decrees from Shanghai effective December 13th, hopefully providing further insight into future developments.

On Tuesday, the Australian economic calendar will feature Business Confidence and Business Conditions, both released revealed by the National Bank of Australia. This comes in anticipation of the upcoming US Consumer Price Index (CPI) release on Tuesday and the Federal Reserve’s monetary policy decision on Wednesday.

Technical Levels: Supports and Resistances

AUDUSD currently trading at 0.6736 at the time of writing. Pair opened at 0.6795 and is trading with a change of -0.87 % .

The pair is trading above its 20 Daily moving average @ 0.6724, above its 50 Daily moving average @ 0.6527 , above its 100 Daily moving average @ 0.668 and below its 200 Daily moving average @ 0.691

The previous day high was 0.6814 while the previous day low was 0.6744. The daily 38.2% Fib levels comes at 0.6787, expected to provide resistance. Similarly, the daily 61.8% fib level is at 0.677, expected to provide resistance.

Note the levels of interest below:

• Pivot support is noted at 0.6754, 0.6714, 0.6684
• Pivot resistance is noted at 0.6824, 0.6854, 0.6894

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