AUDUSD Forecast –Lower as Focus Shifts from RBA Minutes to Aussie Wage Growth Data

The Australian Dollar is edging lower on Tuesday as traders throw their focus on Wednesday’s Wage Price Index report that is forecast to show a quarterly increase of 1%.

Earlier today, traders showed little reaction to the minutes from the Reserve Bank of Australia, which showed the central bank abandoned the thought of pausing at its policy meeting earlier this month. However, policymakers also said that more rate hikes were likely.

At 06:05 GMT, the AUDUSD is trading .6890, down 0.0020 or -0.29%. On Friday, the Invesco CurrencyShares Australian Dollar Trust ETF (FXA) settled it at $68.27, up $0.20 or +0.29%. There was no trading in the ETF market on Monday.

Traders are waiting for the Aussie wages data, which could help decide how much higher rates would have to go. Wage growth is seen picking up to a 10-year high of 3.5% in the fourth quarter last year.

Also on Wednesday, traders will turn their attention to the minutes from the latest policy meeting from the Fed for future monetary policy clues.

On Tuesday, traders will get a chance to react to the U.S. Flash Manufacturing and Flash Services PMI reports at 15:45 GMT. If the data shows the U.S. economy is faring better than expected, then this would raise the chances of interest rates heading higher for longer.

Daily AUDUSD Technical Analysis

The main trend is down according to the daily swing chart. A trade through .6812 will signal a resumption of the downtrend. A move through .7029 will change the main trend to up.

The AUDUSD is currently straddling a pair of 50% levels at .6893 and .6921. The main support is a 50% level at .6760 and the main resistance is a retracement zone at .6985 to .7026.

Daily AUDUSD Technical Forecast

Trader reaction to the pivot at .6893 is likely to determine the direction of the AUDUSD on Tuesday.

Bearish Scenario

A sustained move under .6893 will indicate the presence of sellers. The first downside target is .6866, followed by the minor bottom at .6812.

Bullish Scenario

A sustained move over .6894 will signal the presence of buyers. The first target is a pivot at .6921. This is a potential trigger point for an acceleration to the upside with .6985 to .7029 the next likely upside target area.