AUDUSD Finds a Good-Looking Bearish Resistance

One of the pairs most affected by today’s macro calendar is AUDUSD. We had important events today for both the Australian and American dollar.

The day started with meeting minutes from the RBA’s last meeting. There was a discussion about the hike of 25 or 50 bp (the first one eventually won) and about a further path or a tightening cycle. The consensus was pretty wide as central bankers said there could be a pause of the cycle or maybe it could continue even with a 50bp hike.

Later, on the other side of the ocean, we got a better-than-expected Empire State Manufacturing Index (4.5 vs -6.1) and a smaller PPI (0.2% vs 0.4%). At first, the data caused a weakening of the American dollar and a spike on the AUDUSD but after some time, the price reversed, creating a very interesting technical situation on the chart.

The price is currently forming a Shooting Star candle (yellow) on the daily chart. This candle isn’t present in a random place but on the combination of 38,2% Fibo and the major down trendline (green). In addition to this, we are on the lows from July. That’s a really great place to initiate a bearish correction, so if the hammer stays with us until the end of the day, a major, mid-term sell signal will be created.

On the other hand, the price closing a day above the 38,2% Fibonacci would be a very encouraging signal to buy. In my opinion, the first scenario is currently slightly more probable.