AUD/USD Daily Forecast – Resistance At 0.7485 In Sight

AUD/USD Video 10.12.20.

Australian Dollar Continues To Move Higher Against U.S. Dollar

AUD/USD managed to settle above the resistance at 0.7465 and is moving higher while the U.S. dollar remains flat against a broad basket of currencies.

The U.S. Dollar Index is attempting to gain upside momentum above the nearest resistance at 91. The next resistance level for the U.S. Dollar Index is located at 91.50, and a move towards this level will be bearish for AUD/USD.

Today, foreign exchange market traders will focus on the economic data from U.S. and the latest news on the stimulus front.

Analysts expect that U.S. Inflation Rate will reach 1.1% in November on a year-over-year basis while Core Inflation Rate will be at 1.6%. Initial Jobless Claims are projected to increase to 725,000 while Continuing Jobless Claims are expected to decline to 5.34 million.

Meanwhile, U.S. Republicans and Democrats continue to work on the long-awaited coronavirus aid package. Most likely, negotiations will be finished closer to Christmas, in case a compromise deal is possible. At this point, coronavirus aid package negotiations do not put additional pressure on the American currency but the situation may change quickly if new details emerge.

Technical Analysis

AUD/USD managed to get above the resistance at 0.7465 and is moving towards the next resistance level at 0.7485. RSI has entered the overbought territory but there is some room to gain more momentum in case the right catalysts emerge.

If AUD/USD settles above the resistance at 0.7485, it will head towards the next resistance level at 0.7500. A successful test of this level will open the way to the test of the next resistance at 0.7535. I’d note that AUD/USD has not visited this territory since 2018 so it remains to be seen whether previous levels will be in play in today’s trading action.

On the support side, the previous resistance at 0.7465 will likely serve as the first support level for AUD/USD. If AUD/USD declines below this level, it will move towards the next support at 0.7450. A move below this support level will lead to a test of the next support at 0.7440.

For a look at all of today’s economic events, check out our economic calendar.