The AUD/USD price analysis indicates stronger demand in Australia, with household spending rising in December. Moreover, the Australian dollar rose as risk appetite improved after Trump paused tariffs on Canada and Mexico.Data on Tuesday revealed that household spending in Australia rose in December, marking the third month of an increase. Although this was bullish for the Aussie, Reserve Bank of Australia rate cut bets remained unchanged. Market participants are pricing the first rate cut in February after weaker-than-expected inflation figures last week. Meanwhile, the dollar’s peers, including the Australian dollar, rebounded on Tuesday after Trump paused tariffs on Canadian and Mexican goods. Initially, the dollar had soared after the US President implemented a 25% tariff on Canada and Mexico and a 10% tariff on China starting on Tuesday. However, Canada and Mexico agreed to the demands of the Trump administration, leading to a pause that weighed on the dollar. As a result, the Aussie rebounded.However, the tariff on China started on Tuesday, causing a similar response from the country that could mean a prolonged trade war. This could weaken the Aussie, a proxy for the Chinese yuan. Moreover, a trade war between China and the US will dampen risk appetite, affecting the risk-sensitive Australian dollar. AUD/USD key events today
AUD/USD technical price analysis: Attempting to retest 30-SMA
AUD/USD 4-hour chartOn the technical side, the AUD/USD price trades slightly below the 30-SMA with the RSI below 50, supporting a bearish bias. However, on a larger scale, the price has been trading between the 0.6150 support and the 0.6300 resistance, with several false breakouts. Recently, the price gapped below the range support to reach the 0.6100 support level. However, bulls soon returned, pushing the price back into the range area. However, since it still trades below the 30-SMA, bears might make another attempt at the range support. Bears must make a new low below the 0.6100 level to confirm a solid breakout. On the other hand, if the price breaks above the 30-SMA, it will climb to retest the range resistance level. A break above this level would confirm a bullish breakout. More By This Author:EUR/USD Outlook: Euro Suffers Under a Dovish ECBUSD/CAD Forecast: BoC-Fed Divergence Widens After TrumpAUD/USD Forecast: RBA Rate Cut Odds Grow As Inflation Eases
