Bullish view

• Buy the AUD/USD pair and set a take-profit at 0.6700.
• Add a stop-loss at 0.6580.
• Timeline: 1-2 days.

Bearish view

• Set a sell-stop at 0.6650 and a take-profit at 0.6600.
• Add a stop-loss at 0.6700.

The AUD/USD exchange rate rose slightly after Tuesday’s Reserve Bank of Australia (RBA) minutes and a statement by Jerome Powell. It rose to 0.6665, higher than this week’s low of 0.6630.

FOMC minutes ahead

The Australian dollar rose a bit after the RBA released minutes of last month’s meeting in which the officials left interest rates unchanged.

These minutes showed that the RBA committee was still concerned about inflation, which has remained at an elevated level for a while.

The officials judged that leaving rates unchanged was a better option than hiking rates. Still, they left the door open for a hike later this year if inflation remained sticky. The Australian Bureau of Statistics (ABS) will publish the quarterly inflation report later this month while the RBA will meet on August 6th.

The AUD/USD pair also rose after a statement by Jerome Powell who welcomed the recent inflation numbers. Data by the Bureau of Labor Statistics (BLS) showed that the personal consumption expenditure (PCE) dropped for the first month in six months in May.

Still, Powell noted that he wanted to see more evidence that inflation was moving towards the 2% target. He also said that the US economy was strong, meaning that the Fed has more room to wait before starting to cut rates.

The next important AUD/USD news will be the upcoming US services PMI numbers, ADP jobs numbers, and the Federal Reserve minutes,

Economists expect the data to reveal that the country’s ADP nonfarm employment numbers increased from 152k in May to 159k in June. On Tuesday, a separate report showed that the economy had over 8 million job vacancies in May.

The Fed minutes will provide more colour on what the officials discussed in the last meeting and when to expect in the next meeting.

AUD/USD technical analysis

The AUD/USD pair rebounded to a high of 0.6665 on Wednesday, higher than Monday’s low of 0.6635. On the 4H chart, the pair moved to the Woodie pivot point and rose above the 50-period Exponential Moving Average (EMA).

It has also risen retested the lower side of the Andrew’s pitchfork tool. Oscilllators like the Relative Strength Index (RSI) and the MACD indicators have pointed upwards. Therefore, the pair will likely continue rising as buyers target the key resistance point at 0.6690, its highest point on Monday.

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