FxWirePro: AUD/USD Daily Outlook

Chart - Courtesy Trading View 

AUD/USD was trading 0.19% lower on the day at 0.6687 at around 10:10 GMT, extending previous session's slump.

The pair has erased early gains and slipped lower from session highs at 0.6735, out has turned bearish.

Investors turned extremely cautious on hawkish guidance by the Federal Reserve (Fed). Traders shrug off uncertainty derived from recession fears after the Fed hiked its terminal rate projection.

Market sentiment hurt amid lack of confidence in Fed chair Jerome Powell's speech that inflation will continue to cool down further. 

On the Aussie front, 12-month Australian consumer inflation expectations dropped to 5.2% against the consensus of 5.7% and the former release of 6.0%.

Fall in the inflation expectations might delight the Reserve Bank of Australia (RBA) which has been tightening policy to slowdown the CPI.

Looking forward, focus will be on preliminary S&P PMI numbers. US Manufacturing PMI is seen unchanged at 47.7 while Service PMI would improve to 46.8 vs. the former release of 46.2.

Support levels - 0.6657 (55-EMA), 0.6604 (Lower BB)

Resistance levels - 0.6737 (20-DMA), 0.6770 (5-DMA)

Summary: AUD/USD trades with a bearish bias. Upside was rejected at 200-DMA and bearish RSI divergence adds to the downside bias. Break below 21-EMA has raised scope for more downside. Dip till daily cloud likely.