AUD/USD analysis on February 3, 2025
In Monday's Asian session, AUD/USD is showing steady downward dynamics, developing the "bearish" trend formed last week. At the moment, the asset is testing the 0.6115 level for a downward breakdown, updating the minimum values of April 2020.
The main pressure on the pair is exerted by the decision of the US administration to impose increased import duties of 25% on goods from Canada and Mexico. The exception is Canadian energy resources, which are subject to a reduced rate of 10.0%, similar to Chinese exports. Additional negativity comes from statements by US President Donald Trump about possible sanctions against European goods. Such a policy may lead to an escalation of trade wars, contributing to a weakening of international commodity flows and increased volatility in foreign exchange markets.
The publication of retail sales data in Australia for December is on the agenda today. On a monthly basis, the indicator decreased by 0.1%, which is significantly better than the expected decrease of 0.7%, however, after the previous decrease of 0.7%, the dynamics remains negative. In quarterly terms, retail sales accelerated from 0.5% to 1.0%, showing signs of stabilization in consumer activity. The number of building permits issued increased by 0.7% on a monthly basis after a decline of 3.4%, although a more steady increase to 1.0% was forecast. On an annual basis, the indicator jumped from 3.2% to 12.2%, which may indicate a recovery in the construction sector.
Additional attention was drawn to the data on the index of business activity in the Australian manufacturing industry from S&P Global: in January, it rose from 49.8 to 50.2 points, confirming the recovery of the sector. At the same time, China's Caixin index, reflecting the state of the industrial sector, fell from 50.5 to 50.1 points, signaling a slowdown in the growth of Australia's key trading partner. In addition, the producer price index in Australia in the fourth quarter decreased to 0.8% month-on-month (forecast: 1.0%) and to 3.7% year-on-year (previous value: 3.9%). The slowdown in inflationary processes, combined with a reduction in consumer demand, creates conditions for a possible easing of the monetary policy of the Reserve Bank of Australia (RBA). According to a Bloomberg survey, most analysts expect the regulator to adopt a dovish tone this month, reducing the key rate by 25 basis points to 4.10%.
AUD/USD technical analysis for today
The indicator of the Bollinger band on the daily chart is gradually turning downwards, reflecting the strengthening of the downtrend. The MACD indicator maintains a stable sell signal: the histogram remains below the signal line. Stochastic is approaching the oversold zone, which may indicate a potential short-term upward correction.
Trading recommendations
• It is advisable to open sales after a breakdown down to the level of 0.6100 with a target at 0.6030. The protective stop loss is 0.6130.
• The resumption of bullish dynamics and an upward breakout of the 0.6155 level may be a buy signal with a target of 0.6200. The stop loss is 0.6130.