AUD/USD Price Forecast: Rising 20-day EMA supports near-term bullish bias

The Australian Dollar (AUD) closed lower against the US Dollar (USD) on Wednesday, slipping 0.17% to $0.7070 during the European trading session. Despite this, Reserve Bank of Australia Deputy Governor Andrew Hauser has indicated a possible future tightening of monetary policy. AUD showed strength against the New Zealand Dollar during the day.

Earlier, Hauser noted that inflation is excessive, prompting the central bank to raise interest rates in order to curb price pressures. He also stressed that the monetary policy must be used to reduce inflation and decrease economic demand. Meanwhile, the US Dollar weakened due to diminished expectations of a Federal Reserve interest rate increase at the September meeting, following poor US July data.

Traders will closely monitor the Federal Open Market Committee (FOMC) minutes of the July policy meeting, set to be released at 18:00 GMT. In Australia, investors are expected to focus on the Aussie employment data for July, to be released on Thursday. The AUD/USD pair is currently trading at 0.7073, demonstrating a favorable near-term bullish bias, as the price remains above the 20-period exponential moving average (EMA) at 0.7045, indicating that buyers continue to dominate during dips.

The relative strength index (14) at 57.6 remains in positive territory, signaling upside momentum without being overbought. On the downside, immediate support is located at the 20-day EMA at 0.7045, where renewed buying interest could occur if AUD retreats. The August 17 high of $0.7129 represents a critical hurdle for the pair.