FOMC member Christopher Waller is on the calendar to speak. Before the latest US Jobs and CPI Reports, the Fed Governor warned there was no rush to cut rates because of sticky inflation. A change in outlook on interest rates could move the dial.
The impact of the inflation and retail sales figures on sentiment toward the Fed rate path was evident. According to the CME Fed WatchTool, the chances of the Fed leaving interest rates unchanged in September fell from 34.9% to 27.6% on Wednesday (May 15).
Short-Term Forecast
Near-term AUD/USD trends will likely hinge on the economic data from China and FOMC member commentary. Upbeat data from China could fuel buyer demand for the Aussie dollar. However, lingering concerns about sticky inflation amongst FOMC members could tilt monetary policy divergence toward the US dollar.
AUD/USD Price Action
Daily Chart
The AUD/USD remained well above the 50-day and 200-day EMAs, affirming the bullish price signals.
An Aussie dollar move above the $0.67003 resistance level could bring the $0.67500 handle into play. A break above $0.67500 would give the bulls a run at the $0.67967 resistance level.
Economic data from China and FOMC member speeches need consideration.
Conversely, an AUD/USD break below $0.66500 could signal a drop to the $0.65760 support level and the 200-day EMA. A fall below the 200-day EMA could give the bears a run at the 50-day EMA.
With a 14-period Daily RSI reading of 63.07, the AUD/USD could revisit the $0.67500 level before entering overbought territory.
