Aussie Remains Weak After RBA Meeting Minutes

Fundamental Analysis

* RBA Retreat: The Australian Dollar remains under pressure against the US Dollar following the release of the Reserve Bank of Australia’s (RBA) December Meeting Minutes. RBA has emphasized that upside inflation risks have eased, reinforcing expectations of a potential rate cut in early 2025. This dovish outlook has dampened investor sentiment toward the Aussie, compounding concerns over China’s fragile economic recovery and its critical impact on Australian exports. Additionally, escalating uncertainties surrounding the US-China trade war have further undermined confidence, leaving the currency weighed down by multiple headwinds with little sign of a near-term rebound.

Technical Analysis

* Technical Breakout: AUDUSD was traded lower while currently testing the support level 0.6220. MACD which illustrate diminishing bullish momentum signal suggest the pair to likely further extend its losses.

* Resistance and Support: If the bearish momentum persists, there’s a strong likelihood that the price will potentially head towards the level 0.60650 after it breach below the level 0.6220. Conversely, a potential reversal is also to be expected and the price could head back towards 0.63800.

Understand how technical analysis can help you in this trading opportunity.

Potential Risks

As the holiday season begins and the economic calendar remains relatively light, market sentiment is expected to be the primary driver of market activity. However, U.S. data releases, including Durable Goods Orders and Initial Jobless Claims, may still generate some market movement.

Know how to manage trading risks with risk management strategies.

Monitoring

Stay updated on US and Australia data, central bank updates and any shifts in the US Dollar’s strength by following PU Prime’s market insights and daily financial news.

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Disclaimer: Trading derivatives involves high risks, and market conditions can change rapidly. The content is for informational purposes only and should not be considered as financial advice. Traders should conduct their own research and consider risk management strategies.