• The Australian Dollar is looking weak after rejection at 0.6615.
• The US Dollar remains steady as hopes of a Fed pivot fade.
• AUD/USD is approaching a relevant support area at 0.6520.

The Aussie remains on its back foot on Wednesday’s European Morning session. Price action hovering dangerously close to the 0.6520 support area with the US Dollar showing strength as recent US data cooled hopes of an imminent Fed pivot.

US macroeconomic data cools hopes of Fed cuts

US CPI figures increased unexpectedly in November, revealing that the Fed faces a tough last mile to bring inflation to the 2% target and dampening investors’ expectations of rate cuts in the first quarter of 2024.

Beyond that, the meeting of China’s top leaders ended without any meaningful stimulus program to boost economic growth, which has disappointed investors, adding negative pressure on the Aussie.

AUD/USD approaches key support at 0.6520

Technical indicators are turning lower following another rejection above 0.6600, with a bearish cross on the 4h 100 and 50 SMAs likely to add weight to the pair,

Immediate support lies at 0.6555, which guards the 0.6520 level, a relevant pivot point, and the 38,2 retracement of the October - November rally. 

A bullish reaction here would fave resistance at 0.6615 ahead of the early December peak, at 0.6690.

Technical levels to watch