Can the Aussie Dollar hold above 0.7000 as Fed, RBA and inflation tests approach?

• Choppy trade and a stronger Dollar fail to prevent a 0.11% rise in AUD/USD.
• Ahead of Warsh's press conference, the probability of a December Fed rate hike climbs to 82%.
• Faster Australian CPI inflation could strengthen expectations of further RBA tightening.

A modest 0.11% advance leaves the Australian Dollar consolidating against the US Dollar for a fourth consecutive day, with trading turning choppy before the Federal Reserve’s monetary policy announcement. Markets showed little response to a packed US economic calendar, while attention turns to Australia’s upcoming Consumer Price Index (CPI) release.

Can AUD/USD break out of consolidation near 0.7024 as both central banks come into focus?

Despite broad Greenback strength, AUD/USD stands at 0.7024 at the time of writing. Tracking the performance of six currencies against the US Dollar, the US Dollar Index (DXY) has advanced 0.36% to 102.16.

US data showed the Conference Board (CB) Consumer Confidence reading beating expectations, rising to 91.7 in October from September’s 82.2. Growth in Durable Goods Orders accelerated to 1.8% from 0.1% in September. By contrast, ADP Employment Change came in at 16.8K, down from the prior 17.5K reading.

A series of central bank events, with the Fed taking the lead, now commands market attention. Although the US central bank is expected to leave interest rates steady, markets assign a probability of nearly 82% to a 25-basis-point increase in December. Fed Chair Kevin Warsh's subsequent press conference would determine whether the FOMC is considering another hike this year or deferring it to 2027.

Thursday also brings the Fed’s preferred inflation measure, the Core Personal Consumption Expenditures (PCE) Price Index. An elevated reading, alongside US Gross Domestic Product (GDP) data pointing to continued economic resilience, could strengthen the case for a December rate hike.

Australia’s calendar includes remarks from Reserve Bank of Australia (RBA) Governor Michele Bullock alongside September CPI data. Forecasts put the trimmed mean reading at 0.3% MoM, a tenth above the previous month’s 0.2%. An annual CPI reading above August’s 3.6% would open the door to additional tightening.

AUD/USD Price Forecast: Can the pair overcome technical resistance?

Trading at 0.7028 on the daily chart, AUD/USD retains a slightly bearish short-term outlook below the 50-, 100- and 200-day simple moving averages (SMAs), which converge around 0.7072. Further overhead supply is suggested by prices remaining below rising trend-line break levels at 0.7105 and 0.7455. However, the Relative Strength Index (RSI) reading of 52.6 points to a modest improvement in momentum rather than clear weakness.

The SMA convergence near 0.7072 presents the first upside hurdle. Beyond it lie the upward trend-line break around 0.7105 and the more substantial horizontal resistance at 0.7198. Below current prices, the rising trend line around 0.6920 offers immediate support, followed by the older downward trend-line break near 0.6353. The current 0.7028 region remains a short-term pivot, with sellers holding the advantage unless AUD/USD decisively recaptures the 0.7070/0.7110 zone.

(The technical analysis of this story was written with the help of an AI tool. Know more.)