AUD/USD Forecast: Could Correct Lower In The Near-Term Due To Some Fresh Divergences

Valeria Bednarik - Chief Analyst at FXStreet
·1 min read

AUD/USD Current Price: 0.7943

  • Australian Wage Price Index improved in Q4, but wages remain near record lows.

  • The positive momentum of US indexes boosted the pair ahead of the US close.

  • AUD/USD could correct lower in the near-term due to some fresh divergences.

The AUD/USD pair resumed its advance and reached a fresh multi-year high of 0.7948, poised to close the day a few pips below it. Wall Street positive momentum provided support to the aussie, while Treasury yields retreating from intraday highs limited the greenback’s advance. The softer tone of gold prices partially capped the pair’s bullish potential.

Australia published the Q4 Wage Price Index at the beginning of the day, which rose by 0.6% QoQ and 1.4% YoY, beating the market’s expectations but still well below average and near record lows. The country will publish Q4 Private Capital Expenditure early on Thursday, foreseen at 0% from -3%.

AUD/USD Short-Term Technical Outlook

The AUD/USD pair is still poised to test the 0.8000 threshold, but in the near-term, the risk of a bearish corrective decline increases. The 4-hour chart shows that it bounced from a bullish 20 SMA, but also that the Momentum indicator turned lower, diverging from price action, and that it remains well below its weekly high. The RSI indicator remains flat around 65.

Support levels: 0.7900 0.7865 0.7820

Resistance levels: 0.7965 0.8000 0.8035

View Live Chart for the AUD/USD

See more from Benzinga

© 2021 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.