AUD/USD may come under pressure – OCBC

AUD/USD may remain under pressure as US rates staying higher for longer poses risks to global growth, undermine sentiments and support the USD. These will be the key drivers for now until US economic data starts to show signs of softening. 

We also keep a lookout on US data, in particular core PCE on Friday. Softer data print here can slow the pace of USD uptrend and provide a breather. But apart from paying attention to USD trend, we also need to watch developments in RMB and China PMI data later this week. Lingering weakness in real estate market may be another factor weighing on AUD but with much bad news in the price, we also keep a look out if there is any turnaround in China data softness. Improvement in China data can somewhat partially mitigate against AUD softness. 

Next key support at 0.6370 levels (rising trendline support, double bottom). If we do get a clean break, then bearish pressure can gather traction. Next support at 0.6190, 0.61 levels (76.4% fibo). However, if AUD manages to reclaim 0.6460 (61.8% fibo), then we could still see a bounce towards 0.65 levels (50 DMA), 0.6570.