Detailed FX Market Outlook and Analysis

AUD/USD Daily Analysis 23-MAY-2023

AUD/USD Daily Analysis


In today’s daily update, we turn our focus to the intraday outlook of the AUD/USD pair. The current bias remains neutral, suggesting a balanced market sentiment. However, there is a prevailing inclination towards further downside movement as long as the resistance level at 0.6716 remains unbreached. Notably, a breach below the support level at 0.6616 would trigger a retest of the previous low at 0.6571. A decisive breakthrough at this level would mark the continuation of a larger decline, originating from 0.7164. This decline would target the 61.8% projection level at 0.6463, calculated based on the range of 0.6825 to 0.6567. Conversely, overcoming the minor resistance at 0.6716 would temporarily delay the bearish case and introduce another upward leg within the ongoing corrective pattern from 0.6567.

Zooming out to the bigger picture, the AUD/USD pair’s medium-term outlook remains bearish due to the failure to surpass the 55-week Exponential Moving Average (EMA) at 0.6822. A decisive break of the 61.8% retracement level from 0.6177 to 0.7164, located at 0.6557, would significantly enhance the probability of the long-term downtrend resuming, ultimately targeting the previous low at 0.6177. Therefore, as long as the resistance level at 0.6825 remains intact, this becomes the preferred scenario for the pair’s future direction.

Looking further ahead, if the AUD/USD pair continues its downward trajectory, the next key support level to watch is at 0.6389, which represents the 78.6% retracement level from the range of 0.6177 to 0.7164. A breach below this level would indicate a deepening of the bearish trend and could potentially open up the possibility of a further decline towards 0.6277, the 100% projection level based on the same range.

On the other hand, if the pair manages to break above the resistance at 0.6825, it would suggest a shift in the near-term sentiment and could lead to a corrective rally. In such a scenario, the first target for the upside movement would be the resistance level at 0.6889, followed by the 0.6964 level, which represents the 61.8% retracement level from the range of 0.6177 to 0.7164.

AUD/USD Daily Analysis Summary

In summary, the AUD/USD pair currently exhibits a neutral bias in the intraday outlook, with a prevailing inclination towards further downside movement. The medium-term outlook remains bearish, favoring a continuation of the downtrend. Traders should monitor the key levels mentioned and observe for decisive breakouts or breaches, which would provide further confirmation of the pair’s future direction.

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