AUD/USD appears to be mending its positive correlation with the S&P 500 as the risky-aligned currency braces for US inflation data on Wednesday
The one potential hurdle this week is US CPI, which is expected to show a return to the disinflation narrative but markets will be focused on a much more nuanced measure of inflation, month-on-month core CPI. Month-on-month core CPI has trended around the 0.4% mark- twice that which is believed to bring inflation back down to the 2% target. Early estimates have the figure at 0.3% but markets may look even closer as this figure tends to be rounded up or down. For example, a 2.
AUD/USD has risen above the 200-day simple moving average with ease and appears to be holding above the April 2020 high of 0.6580 where price action has consolidated in recent days.that has appeared around recent swing highs at 0.6645. Even if that is achieved, the 0.6680 level is not too far away – another level that has capped AUD/USD upside.
With a bit of help from the US inflation report , AUD/USD may find the catalyst to really test and possibly break through these levels of resistance. Support remains at 0.6580.If you're puzzled by trading losses, why not take a step in the right direction? Download our guide, "Traits of Successful Traders," and gain valuable insights to steer clear of common pitfalls that can lead to costly errors.
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