• The AUD/USD failed to gain traction amid a positive market mood.
  • The US Dollar remains firm in the session, a headwind for the AUD/USD pair.
  • AUD/USD Technical Outlook: Upwards above the 200-DMA, but might correct to a 50% Fibonacci level before edging higher.

The Australian dollar is set to end the week on a lower note, despite increased risk appetite on earlier news that Russian President Vladimir Putin claimed that the discussions with Ukraine had taken a positive turn. Reflection of the previous mentioned are European and US equity markets in the green, though in the FX space, the antipodeans extend losses. At the time of writing, the AUD/USD is trading at 0.7326, down 0.45% in the North American session.

In the meantime, the greenback remains firm, at 98..630 up 0.12%, a headwind for the AUD/USD. Furthermore, the rise in US Treasury yields, courtesy of the US central bank getting ready hiking rates, by the March 15-16 meeting.

In the Asian Pacific session, RBA Governor Philip Lowe crossed the wires, and he  “warned borrowers to start preparing for higher interest rates, as surging prices of commodities such as oil, gas and coal heap pressure on the central bank to increase rates to control rising inflation,” per AFR. Lowe added that if the central bank would hike by its June meeting, he said that it was not guaranteed but “it’s plausible.”

Data-wise, an absent Australian docket left AUD/USD leaning in US macro, though next week, inflation in Australia would be reported. On the US front, the University of Michigan Consumer Sentiment declined from 62.8 in February to 59.7, while Inflation expectations rose to 5.4% from 4.9% in the previous reading.

AUD/USD Price Forecast: Technical outlook

The AUD/USD remains upward biased but clings just above the 200-day moving average (DMA), at 0.7317. Something to be aware of is that Thursday and Friday’s price action is forming a “tweezers-top” candle chart pattern, meaning that a reversal of the rally that began January 28 might correct before resuming upwards.

That said, the AUD/USD first support would be the 200-DMA. Breach of the latter would expose the confluence of the 50-DMA and the 50% Fibonacci level around 0.7196-0.7205 area, followed by the golden ratio (61.8%) at 0.7148.

This article was originally published by Fxstreet.com.Read the original article here.


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