The Australian dollar has been in a tight range in the past few days.
- Sell the AUD/USD pair and set a take-profit at 0.6600.
- Add a stop-loss at 0.6800.
- Timeline: 1-2 days.
- Set a buy-stop at 0.6715 and a take-profit at 0.6850.
- Add a stop-loss at 0.6600.
The AUD/USD exchange rate was flat on Tuesday even as the US dollar index dropped to its lowest level on April 14. The pair was trading at 0.6700, where it has been stuck in the past few days. This price is a few points below this month’s high of 0.6810.
The AUD/USD pair has been in a tight range in the past few days as the focus turned to the next actions of the Federal Reserve and the Reserve Bank of Australia (RBA). Analysts expect that the RBA will maintain its interest rates unchanged in the coming months. It decided to leave rates intact in its meeting this month.
There will be no economic news from Australia. Therefore, the focus will be on the important numbers from the United States. The first key data will be the closely-watched house price index (HPI) data. Economists polled by Reuters expect the data to show that the HPI dropped by 0.4% in February. They also expect that the HPI rose by 3.9% on a year-on-year basis.
US home prices have been moving downwards in the past few weeks because of the rising interest rates and mortgage rates. The US will also publish the March new home sales data. Expectations are that new home sale fell from 640k in February to 630k in March.
The other important economic data will be the consumer confidence data from Conference Board. The median estimate is that consumer confidence dropped from 104.2 to 104 in April. Consumer confidence is important data because consumer spending is the most important part of the economy.
The Australian dollar has been in a tight range in the past few days. It is consolidating at 0.6700, which is along the lower side of the ascending channel. The pair has moved slightly below the 25-period moving average. It has moved below the Ichimoku cloud. Additionally, the MACD has moved below the neutral point.
The AUD/USD pair has also moved slightly below the Woodie pivot point. Therefore, the exchange rate will likely have a bearish breakout in the coming days. If this happens, the next key support level to watch will be at 0.6600. The alternative situation is where the pair rebounds and retests the upper side of the channel at 0.6815.