AUD/USD is testing a key resistance space after China printed its Caixin manufacturing PMI and earlier than the remainder of the world went again from their holidays.

Will we see a breakout within the subsequent buying and selling periods? Or will the pair stay in a low-key downtrend?

Earlier than transferring on, ICYMI, I’ve listed the potential financial catalysts that you should be careful for this week. Test them out earlier than you place your first trades right this moment!

And now for the headlines that rocked the markets within the final buying and selling periods:

Recent Market Headlines & Financial Information:

Over the weekend, China’s official manufacturing PMI got here in at 49.0 in December (from 49.4 in November); Non-manufacturing PMI ticked greater from 50.2 to 50.4

BRC: U.Okay.’s meals inflation slowed down from 7.7% y/y to six.7% y/y in December, the slowest fee since June 2022, as discounters competed to draw buyers

China’s Caixin manufacturing PMI improved from 50.7 to 50.8 in December as firmer demand helped enhance output and new orders

Australia’s commodity value index rose by 2.5% m/m in December after a 4.1% m/m uptick in November

Oil costs gained floor after Iran dispatched a warship to the Pink Sea following the U.S.’ destruction of three boats of Iran-backed Houthi rebels

Spain’s manufacturing PMI in December: 46.2 (47.0 forecast, 46.3 earlier); “Output and new orders each fell steeply amid studies of subdued market demand”

Italy’s manufacturing PMI for December: 45.3 (44.3 forecast, 44.4 earlier); “Contractions in output and new orders have been largely behind the sustained downturn” for the month”

France’s ultimate manufacturing PMI for December: 42.1 (42.0 forecast, 42.9 earlier); “Declines in manufacturing, new orders and buying exercise worsened, whereas manufacturing unit jobs have been misplaced for a seventh straight month”

Germany’s ultimate manufacturing PMI for December: eight-month excessive of 43.3 (43.1 forecast, 42.6 earlier); The survey “signaled stable and barely accelerated decreases in each output and employment”

Eurozone’s ultimate manufacturing PMI for December: 44.4 (44.2 forecast, 44.2 earlier); “Actions in some sub-indices to counsel the worst of the business’s hunch has handed”

BTC/USD traded above $45,000 to its highest since April 2022 on bitcoin ETF approval optimism

Value Motion Information

Overlay of CHF vs. Main Currencies Chart by TradingView

A scarcity of top-tier knowledge releases translated to threat sentiment taking up a barely larger position in transferring the foremost currencies throughout the Asian and early European periods.

CHF, specifically, weakened towards its main counterparts after China’s stronger Caixin manufacturing PMI eased issues from the weaker-than-expected official PMI numbers over the weekend.

For now, the secure haven is within the crimson throughout the board. It’s registering the most important losses towards AUD and GBP and is barely marginally weaker towards USD and JPY.

Upcoming Potential Catalysts on the Financial Calendar:

U.Okay.’s ultimate manufacturing PMI at 9:30 am GMT
Canada’s manufacturing PMI at 2:30 pm GMT

Use our new Forex Warmth Map to shortly see a visible overview of the foreign exchange market’s value motion!  ️

AUD/USD 15-min Foreign exchange Chart by TV

I don’t know in case you observed however AUD/USD has been poppin’ up decrease highs and decrease lows since hitting a resistance across the .6860 space final week.

One doable purpose is that some merchants took income from the pair’s robust December uptrend earlier than the 12 months ended.

AUD/USD is now buying and selling nearer to .6830, which is correct the place we will discover a falling pattern line resistance. Not solely that, however the pair’s present ranges are additionally close to the R1 (.6840) Pivot Level line in addition to the 100 and 200 SMAs within the 15-minute time-frame.

We don’t have a number of top-tier financial studies on faucet throughout the U.S. session so threat sentiment might seemingly issue within the pair’s value motion. Look out for merchants pricing within the Fed’s December assembly minutes and merchants probably re-pricing their Fed fee lower bets.

Deal with start-of-year risk-taking or the Fed probably slicing its rates of interest this 12 months may encourage a risk-friendly atmosphere and push AUD/USD greater. The pair might break above its descending channel sample and revisit inflection factors like .6870 or .6900.

However, we may see cautiousness prevail forward of this week’s potential catalysts. Escalating tensions within the Pink Sea might also drive merchants into shopping for secure havens like USD.

If right this moment’s headlines encourage threat aversion, then AUD/USD might lengthen its short-term downtrend. The pair may flip decrease from its pattern line resistance and head for its earlier lows close to .6810 or the S1 (.6780) Pivot Level line.