The Australian dollar (AUD) has been under pressure against the US dollar (USD), experiencing a decline for the fourth consecutive day on Thursday. However, the release of positive Australian export price data provided a temporary reprieve, boosting the AUD against the USD. According to figures released by the Australian Bureau of Statistics, export prices saw a 3.6% increase in the fourth quarter of 2024 compared to the previous quarter. This reversal of a 4.3% decline in the third quarter marks the first increase in export prices since the fourth quarter of 2023, suggesting improving trade conditions for Australia. The Australian economy is projected to have expanded by approximately 0.2% in 2024, a significant rebound from the 1.4% contraction experienced in the third quarter. This positive growth figure surpasses market expectations of a 1.5% decline and indicates resilience in the face of global economic headwinds.
From a technical analysis perspective, a break above the descending channel and the 20-day simple moving average (SMA) around 0.6440 could present a significant challenge for bullish traders. However, they would first need to overcome resistance at 0.6388. If this level is breached, the pair could advance towards the 0.6500-0.6530 region, where the 50-day SMA resides. Slightly above this zone, the 0.6565 level could open the way for the 200-day SMA at 0.6615. It is noteworthy that the 50-day and 200-day SMAs recently formed a "death cross," a bearish signal suggesting that any immediate trend reversal is unlikely. This technical formation reinforces the prevailing bearish sentiment. In summary, the downtrend in the AUD/USD pair remains firmly entrenched, and the pair is expected to continue its downward trajectory in the short term. While a recovery attempt towards the 2023 low is possible, selling pressure is likely to persist below the 0.6565 level. The combination of fundamental factors, including RBA policy expectations, global economic concerns, and US dollar strength, along with bearish technical signals, suggests that the AUD/USD pair's outlook remains predominantly negative. Traders should exercise caution and monitor upcoming economic data releases and technical levels for potential trading opportunities.
