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AUD/USD AUD/USD AUD/USD AUD/USD AUD/ AUD/JPY: AUD/JPY: AUD/JPY: AUD/JPY Weekly AUD/USD ChartSource: Trading View The exchange rate may continue to give back the V-shape recovery from 2020 as the Reserve Bank of Australia (RBA) appears to be on track to maintain the current monetary policy course, with the AUD/USD trading to a new 2021 low (0.7477) in June as Federal Reserve officials project two rate hikes for 2023, and the exchange rate may continue to give back the V-shape recovery from 2020 as the Reserve Bank of Australia (RBA) appears to be on track to maintain the current monetary Keep in mind that, despite a string of failed attempts to close below the neckline around 0.7560 (50 percent expansion) to 0.7570 (78.6 percent retracement), AUD/USD avoided forming a head-and-shoulders pattern, with the break of the April low (0.7532) pushing the exchange rate up against the 50-Week SMA (0.7485) for the first time since June 2020. The Relative Strength Index (RSI) illustrates a similar dynamic, as the indicator establishes a downward trend and sits at its lowest level in over a year. It remains to be seen whether the decline from the February high (0.8007) will turn out to be a correction in the broader trend or a key reversal in market behavior, given the Fed and RBA’s divergent paths. Failure to hold above the 50-Week SMA (0.7485) may send the AUD/USD towards the prior resistance zone at 0.7390 (38.2 percent expansion) and 0.7090 (78.6 percent retracement) to 0.7180, with the next area of importance around 0.7090 (78.6 percent retracement) to 0.7180. (61.8 percent retracement). Weekly Chart of the Australian Dollar vs. the Japanese YenSource: Trading View The Australian dollar has outperformed its US counterpart, climbing to a new yearly high (85.80) in May, and the exchange rate may continue to show bullish market activity as long as it remains above the March low (82.09). However, the Relative Strength Index (RSI), which failed to reach overbought territory in May, appears to have diverged from price, and the oscillator may continue to show bullish momentum waning as it breaks the upward trend from the previous year. With that said, the V-shape recovery from 2020 may stall ahead of the Fibonacci overlap around 86.10 (38.2 percent retracement) to 86.30 (78.6 percent expansion) in the coming months, with a close below the 82.40 (50 percent expansion) region on a weekly timeframe putting the 79.50 (161.8 percent expansion) to 80.20 (38.2 percent expansion) area on the radar. —- Currency Strategist David Song wrote this article. @DavidJSong is my Twitter handle./nRead More

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