On the daily chart below for AUDUSD, we can see that after bouncing from the bottom of the range at 0.6563, the market rallied towards the top where it found resistance again from the 38.2% Fibonacci retracement level. The price has been stuck in this range for 3 months already as the market remains uncertain on what’s next amid contradictory economic data . At the moment, the market expects the Fed to pause in June and start cutting rates before the end of the year. So, the buyers should remain in control as long as the data confirms this outcome, but if the data continues to point to a more hawkish path, then we should see the sellers come back.

AUDUSD technical analysis

On the 4 hour chart below, we can see that the price is now being rejected from the resistance and the 38.2% Fibonacci retracement level. We should see a pullback towards the trendline and the support at 0.6720 where the buyers are likely to pile in expecting another rally afterwards. The sellers, on the other hand, will want to see the price breaking through the trendline to jump onboard and extend the selloff towards the bottom of the range.

On the 1 hour chart below, we can see that an eventual pullback towards the trendline will have extra confluence from the 38.2% Fibonacci retracement level. Therefore, the 0.6720 level is a strong area to watch as it should define the next big move. Tomorrow, we have the US CPI report and it’s likely that higher than expected data will give a boost to the USD as the market would change its interest rates expectations, while lower than expected figures should lead to more USD depreciation.