The AUD/USD pair maintained its downward trajectory on Thursday as Iran and the United States adopted divergent stances regarding the resolution of the ongoing conflict. The value decreased to 0.6940, a decline from the peak of 0.7180 observed earlier this year. The AUD/USD pair experienced a decline this week following the Iranian government’s dismissal of Donald Trump’s overtures for dialogue. The Trump administration proposed a 15-point plan aimed at concluding the conflict, which encompasses the dismantling of the nation’s nuclear facilities. Iran, conversely, has dismissed that proposal and presented a set of five conditions, which encompass reparations and the closure of US military installations in the Middle East. Consequently, it appears that the prevailing situation suggests the protraction of the current conflict, particularly in light of the United States mobilizing forces in the area.
Some analysts anticipate that the troops will seek to secure the strategic Kharg Island and/or establish positions to safeguard the Strait of Hormuz. The resurgence of crude oil prices can be attributed to these prevailing fears. Brent, the global benchmark, surged to $99, while West Texas Intermediate rose to $92. The AUD/USD pair is poised to respond to the forthcoming US initial and continuing jobless claims data. Additionally, a number of Federal Reserve officials are scheduled to present their remarks in the upcoming two sessions. Lisa Cook is scheduled to speak later today, while Stephen Miran and Philip Jefferson are set to address the audience on Friday.
In a statement on Wednesday, Stephen Miran expressed his continued support for cutting interest rates, notwithstanding the prevailing concerns regarding inflation. The Reserve Bank of Australia has indicated a potential increase in interest rates, given the persistence of elevated inflation levels. A report released this week indicated that both the headline and weighted mean inflation persisted above 3% in February. The daily chart indicates that the AUD/USD pair has experienced a decline for three consecutive days and is currently positioned near its lowest level since February. The value has decreased to 0.6945, down from the year-to-date peak of 0.7180.
The pair has descended past the ascending trendline that links the lowest swings observed since January of this year. It has fallen beneath the 50-day Exponential Moving Average. The two lines of the Percentage Price Oscillator have persisted in their decline and are nearing a position below the zero line. The Relative Strength Index has persistently declined and is gradually approaching the oversold threshold. Consequently, the pair is expected to maintain its downward trajectory, with the next significant level to monitor being at 0.6800.