AUD/USD Forex Signal: Aussie Has More Upside Ahead Of US PCE Report

The Australian dollar retreated sharply after the strong US GDP data. It moved from a high of 0.6676 to a low of 0.6600.  Bullish view

 Bearish view

The AUD/USD exchange rate pulled back on Wednesday after the strong US GDP data. After rising to a high of 0.6676, the pair retreated to a low of 0.6605. The pair has risen by more than 5.60% from its lowest point in October. US PCE data aheadThe Australian dollar has been in a strong uptrend in the past few weeks as the US dollar index and VIX retreated. The dollar index retreated from the year-to-date high of over $107.3 to a low of $102.5.Similarly, the VIX index, which is a popular fear gauge in Wall Street, has plunged by more than 50% from its highest point this year. The fear and greed index has also jumped to the greed area.At the same time, risky assets like American technology stocks and cryptocurrencies have rallied, signaling that investors have embraced a risk-on sentiment. The main reason is that there are hopes that the Federal Reserve will start cutting rates in 2024.Most economists expect that the first rate cut will happen in June next year. In an interview on Tuesday, Bill Ackman, a respected hedge fund manager, said that he expected rates to start falling in the first quarter.The AUD/USD price retreated after the strong US GDP data. According to the statistics agency, the economy expanded by 5.2% in the third quarter as consumer spending continued. That report means that the Fed could hold rates at higher rates for longer.The next important news to watch will be the latest Personal Consumer Expenditure (PCE) data, which is the Fed’s favorite inflation gauge. Economists polled by Reuters expect the data to show that the headline PCE dropped to 3.1% while core PCE fell to 3.5% in October. AUD/USD technical analysisThe Australian dollar retreated sharply after the strong US GDP data. It moved from a high of 0.6676 to a low of 0.6600. The pair has remained above the 50-period Exponential Moving Average. It has moved slightly below the first resistance of the Woodie pivot point.The Relative Strength Index (RSI) has moved from the extreme overbought level of 80 to below 26. Also, the Stochastic Oscillator has also retreated. The outlook for the pair is bullish, with the initial level to watch being this week’s high of 0.6676. The stop-loss of this trade will be at 0.6550. More By This Author:GBP/USD Forex Signal: Sterling Uptrend Has Room To RunBTC/USD Forex Signal: Briefly Reaches 18-Month High PriceUSD/JPY Analysis: Amid Downward Pressure On The Dollar