#AUDUSD @ 0.62729 is looking to test the 0.6250 cushion as the dismal market mood has rebounded. (Pivot Orderbook analysis)

…
This is a premium post.
[s2If !current_user_can(access_s2member_level4)]Please register for PREMIUM VERSION HERE to read full post below containing analysis. In case of any error or you think you are not able to read the full post below, please email us at support#nehcap.com [lwa][/s2If] [s2If current_user_can(access_s2member_level4)]

• AUD/USD is looking to test the 0.6250 cushion as the dismal market mood has rebounded.
• The DXY has recovered its losses after knee-jerk to near 112.50 ahead of Fed minutes.
• Fed policymaker’s hawkish commentary has accelerated the odds of a 75 bps rate hike.

The pair currently trades last at 0.62729.

The previous day high was 0.638 while the previous day low was 0.6275. The daily 38.2% Fib levels comes at 0.6315, expected to provide resistance. Similarly, the daily 61.8% fib level is at 0.634, expected to provide resistance.

The AUD/USD pair has turned sideways in early Asia followed by a steep decline from around 0.6350 after a short-term risk-on mood faded. The asset is oscillating in a 0.6259-0.6280 range and is expected to retest the fresh two-year low at 0.6250 ahead. It indicates that the overall market mood is extremely negative and investors have capitalized on the pullback by adding shorts.

The late-night sell-off in the S&P500 after an intraday rebound has firmed up the negative market sentiment again. Apart from that, the US dollar index (DXY) has recovered to near 113.30 after a knee-jerk action. Meanwhile, the 10-year US Treasury yields are on the cusp of reclaiming the 4% hurdle.

Going forward, investors’ entire focus will be on the Federal Reserve (Fed) minutes, which are due on Wednesday. The minutes will provide detailed reasoning behind the announcement of the third consecutive 75 basis points (bps) rate hike by the Fed. Apart from that, projections over targeted terminal rate, inflation, and economic growth will be of utmost importance.

Meanwhile, hawkish commentary from Cleveland Fed President Loretta Mester that “we haven’t seen progress on inflation, we have seen some moderation- but to my mind, it means we still have to go a little bit further”, at Economic Club of New York, has accelerated odds of a fourth consecutive 75 bps rate hike in the first week of November. As per CME Fedwatch tool, chances for a 75 bps rate hike have improved to 77.7%.

On the Aussie front, Reserve Bank of Australia (RBA) Assistant Governor Luci Ellis has termed the neutral rate as a guide for policy, not a destination, which indicates that the targeted Official Cash Rate (OCR) at 3.85% by the central bank could be adjusted further. She further added that inflation expectations over one year will remain well anchored in a 2-3% range, at the Citi Australia and New Zealand Investment Conference.

Technical Levels: Supports and Resistances

AUDUSD currently trading at 0.6274 at the time of writing. Pair opened at 0.6302 and is trading with a change of -0.44 % .

The pair remains strongly bearish on the daily time frame. It trades below the 20 SMA @ 0.655, 50 SMA 0.6768, 100 SMA @ 0.6868 and 200 SMA @ 0.7052.

The previous day high was 0.638 while the previous day low was 0.6275. The daily 38.2% Fib levels comes at 0.6315, expected to provide resistance. Similarly, the daily 61.8% fib level is at 0.634, expected to provide resistance.

Note the levels of interest below:

• Pivot support is noted at 0.6257, 0.6213, 0.6152
• Pivot resistance is noted at 0.6363, 0.6424, 0.6469

[/s2If]
Join Our Telegram Group