The year-over-year PPI data stands at 4.3%, a 0.2% increase from the previous reading. This index remained at the previous monthly level of 0.9%. The AUDUSD pair reacted to this by strengthening its position.
Another driver of the AUDUSD strengthening could be the release of the US core personal consumption expenditures price index for March. The forecast suggests a decline of 0.2% from the previous year-over-year reading. Results above the estimates are considered positive for the US dollar, while those falling below the forecast are considered unfavourable.
AUD/USD has reached the target of the third decline wave at 0.6362 on the H4 chart. A consolidation range has formed above this level. With an upward breakout, a correction continues to develop to 0.6530 (as a minimum). Once the correction is complete, a new range is expected to form. The fifth Elliott wave might start with a breakout below this range, aiming for 0.6336, representing the downward trend’s local target. Technically, this scenario is supported by the specified Elliott wave structure and a correction matrix. The market has received support at the lower boundary of the decline wave’s Envelope and is forming a correction with a pivot point at 0.6444. Once the correction is complete and the price tests the Envelope’s upper boundary from below, the fifth decline wave to its lower boundary is expected to start.
The AUD/USD pair may experience sharp fluctuations after the release of upcoming news. If the data is positive, the Australian dollar has a chance to strengthen its position. The growth target might be the 0.6560 mark.
Written by RoboForex Analytical Department
