Current flow

The AUD/USD pair is developing strong "bullish" momentum at 0.6508, formed at the end of last week, when it managed to pull back from the August 5 local lows in response to the publication of macroeconomic statistics from the US.

Investors noted a slowdown in the dynamics of Retail Sales in October from 0.8% to 0.4% with expectations of 0.3%, and the indicator excluding autos fell from 1.0% to 0.1% with expectations of 0.3%. In contrast, Industrial Production volume fell 0.3% after -0.5% a month earlier, and Capacity Utilization fell from 77.4% to 77.1%, while analysts expected 77.2%. Meanwhile, the NY Empire State Manufacturing Index strengthened in November from -11.9 points to 31.2 points, while experts expected -0.7 points.

Investors' focus today is on the minutes of the Reserve Bank of Australia (RBA) meeting on November 5, when interest rates will be kept at 4.35%. Officials noted that the current monetary policy remains balanced and fully meets the current risks in both the domestic and global economy. The regulator still considers the rate of decline in domestic inflation insufficient and expects the Consumer Price Index to remain in the 2.0–3.0% range until the September quarter of 2025, after which growth may be driven by the end of the current discount on energy resources. Employment growth slowed in October while the unemployment rate remained unchanged, underscoring the resilience of the labor market. Against this backdrop, RBA Governor Michele Bullock stressed last Thursday that current borrowing costs are relatively limited and will remain unchanged until the regulator is confident about inflation expectations.

Support and resistance

On the daily chart, the Bollinger Bands try to reverse horizontally. The price range is growing, wide enough for the current level of activity in the market. MACD has turned bullish after forming a new buy signal (located above the signal line). Stochastic is retreating rapidly from the lows, signaling the risk of the Australian dollar being oversold in the very short term.

Resistance levels: 0.6536, 0.6570, 0.6600, 0.6622.

Support levels: 0.6500, 0.6478, 0.6440, 0.6420.

Trading tips

A buy position can be opened after the breakthrough of 0.6536 with a target of 0.6600. Stop-loss — 0.6500. Implementation period: 2-3 days.

A "downtrend" reversal with a break of 0.6478 may be a signal for a new sell position with a target at 0.6420. Stop-loss — 0.6500.