AUD/USD Surged: Helped by RBA Confidence and Inflation Growth

The Australian dollar increased noticeably against the US dollar. AUD/USD rose to 0.6684. The index of leading economic indicators from MI for May in Australia turned out to be zero and will not change from the previous value.

The weighted average consumer price index in Australia in May rose to 4.0% y/y from the previous step of 3.6%. The forecast was less ambitious and suggested a strengthening to 3.8%.

The statistics presented a little earlier reflected a surge in the index of consumer sentiment in Australia from Westpac in June. The index rose by 1.7%, while in May it fell by 0.3%.

The Reserve Bank of Australia is not concerned about the growing interest of consumers in private loans. This was revealed by RBA Assistant Governor Chris Kent. Speaking at the Australian Banking Association conference, he noted that private crepitus plays a very important market role. The RBA is keeping a close eye on this. However, the regulator is not overly concerned about growth here as this asset class is not particularly large in Australia.

That said, business investment is picking up. Kent drew attention to the presence of a significant contrast between business confidence and business conditions and where the consumer is. This position looks to be below average levels.

AUDUSD technical analysis


On the H4 chart of AUD/USD, the market ended the correction at 0.6577. Today we consider the formation of a consolidation range around the level of 0.6666 With an upside exit we will consider the probability of another growth structure to the level of 0.6703 with the prospect of continued growth to the level of 0.6744. Further the correction link to the level of 0.6666 (test from above) is not excluded. Then we will consider the probability of a growth link to the level of 0.6750. Technically such scenario is confirmed by MACD indicator. Its signal line is above the zero mark and is directed strictly upwards.


On the H1 chart of AUD/USD the correction to the level of 0.6626 is executed. Today the market broke upwards to 0.6666 and continues the growth link to 0.6694 with the prospect of continuing the development of the wave structure to 0.6704. The target is local. Technically, this scenario is confirmed by the Stochastic oscillator. Its signal line is above the level of 80. We expect the beginning of the decline link to the level of 20.

By RoboForex Analytical Department

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