AUD Australian Dollar – US dollar consolidates at highs as Fed cuts rates but signals slower pace

The U.S. Federal Reserve cut interest rates on Wednesday and signaled it would slow the pace of further cuts in borrowing costs given relatively stable unemployment and little recent improvement in inflation. Fed policymakers now expect they will cut interest rates just twice by 25 basis points each by the end of 2025, 50 basis points fewer cuts than they had forecast as of September. After the Federal Reserve announced its decision, U.S. stocks fell sharply on Wednesday and the U.S. dollar soared. The U.S. dollar index once rose to 108.27, which is the highest point in two years. Federal Reserve Chairman Jerome Powell said on Wednesday that further cuts in borrowing costs depended on further progress in reducing stubbornly high inflation, and he made clear and repeated the need to proceed cautiously from now on.

The Australian dollar has continued to fall against the US dollar since the end of September and has formed a fairly neat downward trend line. So far, a more important resistance has emerged at 0.64. If the exchange rate can rise above this area in the future, it will be regarded as an important factor in reversing the weakness. signal. In addition, the current technical chart shows that both the RSI and stochastic index have rebounded from the oversold area, and it can be expected that the decline of the Australian dollar against the US dollar will slow down in the short term. Calculated according to the golden ratio, the rebound range of 23.6% and 38.2% is 0.6370 and 0.6480, and the extension to 50% and 61.8% is 0.6565 and 0.6655 levels. The support levels are 0.62 and 0.6160, and then we will pay attention to the 0.60 mark.

Estimated range:
Resistance 0.6400* - 0.6480 – 0.6565
Support 0.6200 – 0.6160 – 0.6000*
 

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