Capex preview: what to expect in AUD/USD?

AUD/USD has been stable in the Tokyo open while we await a huge amount key data points for the Pacific today.

The Capex is a huge component that the RBA must consider while it has entered a phase of being "not so certain" of risks that lie ahead for the Australian economy and although this data has been put on the back burner by markets of late, we are entering a very critical phase of this year's cycle of worldwide economics. There has been more focus on the outlook for nations inflation of late by the RBA, but today's data still has the ability create surprises and can offer subsequent volatility for the Aussie dollar.

The Australian Bureau of Statistics (ABS) will give out Australia’s June quarter private capital expenditure (CAPEX) report and this offers a glance at past business investment and, more importantly, where it’s expected later this year. The previous data for the beginning of the year was not pretty, with  Q1, CAPEX falling 5.2% to $30.613 billion. What was key is the fact that spending on equipment, plant and machinery dropped 0.5% to $11.753 billion while expenditure on building and structures also fell 7.9% to $18.86 billion at a time where inflation was a concern to the RBA. Turning to the June quarter report, the decline in CAPEX is expected to continue with a drop of 4.1% forecast. Mining will be a key make up in the data for Australia's Policymakers. We also look ahead to the Chinese data and Aussie retail sales of which a preview can be read here:

Chinese data and Aussie retail sales preview: what to expect in AUD/USD?

AUD/USD levels

Technically,  Valeria Bednarik, chief analyst at FXStreet explained that in the 4 hours chart, the technical outlook favors the downside, as the price remains below a bearish 20 SMA, the Momentum indicator heads south within negative territory, whilst the RSI indicator holds flat around 37. Spot is presently trading at 0.7521, and next resistance can be seen at 0.7525 (Daily High), 0.7531 (Daily Classic PP), 0.7535 (Yesterday's High), 0.7561 (Daily Classic R1) and 0.7563 (Hourly 100 SMA). Support below can be found at 0.7518 (Daily Open), 0.7517 (Hourly 20 EMA), 0.7514 (Daily Low), 0.7511 (Weekly Classic S1) and 0.7510 (Monthly Low).  Regarding candlestick formations, we can see Dark Cloud Cover formation on the 1-hour.