A hot Nonfarm Payrolls report saw traders reprice the potential for a September Fed hike, making this week’s CPI and PPI figures all the more important. Fed funds futures are now back above a 60% probability of a 25bp hike in two weeks, after 162k jobs were added compared with the 53k expected.
We also have a 30-year Treasury auction which may garner more attention than usual, given the bouts of market volatility whenever its yield pushes above 5.3%. The last time it did, Treasury Secretary Scott Bessent doubled the size of long-end Treasury buybacks to provide greater liquidity support. The auction will therefore test whether investors are comfortable absorbing long-duration debt around current yields, or whether they demand an even higher premium.
Despite the renewed Fed risk, AUD/USD remains above 72c and within reach of its May high. That leaves US inflation, Treasury yields and broader risk appetite as the main near-term drivers for the Australian dollar.
View related analysis:
AU GDP Unlikely to Derail RBA Hike, AUD/USD Eyes ISM, NFP
Australian Dollar Outlook: AUD/USD Faces RBA-Fed Rate Tug-of-War
Australian Dollar Price Action Setups: EUR/NZD, GBP/AUD, EUR/AUD
FX Futures Positioning: Dollar Rebound Meets Diverging Forex Bets | COT Report
Australia This Week: Economic Data and Events for AUD/USD Traders
Australia’s slowing GDP seems unlikely to derail bets of another RBA hike, with cash rate futures having fully priced in a 25bp move by November. The 1-year OIS has fully priced in two. So attention will shift to comments from RBA’s Hunter and Hausser on Tuesday to see if any policy clues are dropped. My guess is that they’ll retain a slightly hawkish tone without committing to much more.
Consumer and business confidence seems likely to show evidence of RBA-hike concerns. Beyond that, it seems appetite for risk and the US dollar’s direction via CPI and bond auction results could be the key driver for the Australian dollar this week.
AUD/USD Technical Analysis: Australian Dollar vs US Dollar
AUD/USD Correlation Analysis
US dollar sensitivity has snapped back: AUD/USD’s correlation with USDX is -0.92 over 10 days and -0.94 over three days, making USD direction the dominant near-term driver.
The yuan remains the most consistent positive relationship: CNH/USD correlations sit at 0.75–0.84 across 3, 10 and 20-day windows, reinforcing China/yuan sentiment as an important AUD/USD input.
Risk and commodity correlations have surged very recently: three-day correlations with the S&P 500 (0.99), gold (0.95), WTI (0.94) and copper (0.87) suggest AUD/USD is currently trading with a strong risk-on/commodity beta.
Short-term relationships remain fluid: several 20-day correlations are weak despite much stronger 3- and 10-day readings, so traders should favour the relationships currently strengthening rather than rely on longer-term averages.
Source: LSEG
AUD/USD Futures Positioning: COT Report
It is more of the same story where futures exposure is concerned for the Aussie. Traders have continued to increase their longs and shorts at a gradual pace, effectively keeping net-short exposure near similar levels to the week prior, albeit a touch less bearish.
This suggests traders continued to hedge their bets despite AUD/USD climbing above 72c to a 16-week high. The more reliable signal is therefore price action and rising total open interest, which now sits at a record high. This shows us that demand for Australian dollar exposure from all participants combined is rising alongside AUD/USD prices.
Source: CFTC (COT) CME, LSEG
For traders wanting a deeper understanding of futures positioning, I’ve also published a guide on how to read and interpret weekly COT data in forex markets.
AUD/USD Options and Volatility Analysis (Risk Reversals, HVN Levels)
Implied volatility has continued to trend lower while prices have moved higher in recent weeks, while 1-month IV remains above 1-week IV to show a calm confidence in the bullish trend. A small bullish engulfing week also formed, although with the May high nearby, the rally may be maturing to the point that it needs a pause or pullback. The daily chart shows AUD/USD held up well to the strength of NFP on Friday by closing flat, although it formed a doji which shows some hesitation from bulls to push higher immediately.
The AU-US 2-year spread edged lower, though not at an alarming rate. Risk reversals also curled slightly higher last week to show a modest pickup in call demand relative to puts, so options traders are not panicking about a deep pullback.
Overall, AUD/USD still has the potential to rise towards the May high and eventually break above it. How US data lands this week could simply determine whether we see an initial pullback or a direct move towards it first.
Alt: AUD/USD rises as implied volatility falls, with risk reversals and the AU-US 2-year spread supporting a constructive Australian dollar outlook.
Source: ICE, TradingView
Australian Dollar Performance
Australian dollar performance table shows AUD gains across most major crosses, while AUD/JPY underperforms over five and 10 days.
JPMorgan zůstává na AUD/USD býčí, ale chce počkat na pokles k 0,7080–0,7000, než znovu přidá dlouhé pozice. Kurz se drží nad úrovní, kde chce banka nakupovat.
Currency analysts remain bullish on the AUD/USD exchange rate but wants a retreat to 0.7080-0.7000 before rebuilding long positions. The Australian Dollar is trading above the level where JPMorgan wants to buy it.
Latest — Exchange Rates:
Australian Dollar to Dollar (AUD/USD): 0.720395 (+0.04%)
Pound to Australian Dollar (GBP/AUD): 1.876283 (-0.13%)
Euro to Australian Dollar (EUR/AUD): 1.612118 (-0.17%)
AUD/USD closed near 0.7204 on Friday after reaching 0.7214, leaving the pair roughly 1.7% above the desk’s first preferred entry and 2.8% above the bottom of its buying zone.
JPMorgan is not abandoning its constructive view.
The desk simply considers the current level unattractive for adding exposure.
“We have been bullish on AUD for well-trodden reasons, but with the pair generally struggling at these levels, we have been waiting for a pullback towards 0.7080/00 before topping up on longs.”
The preferred strategy is to rebuild long positions around 0.7080, with 0.7000 representing the deeper end of the zone.
That makes this a pullback call rather than a forecast that AUD/USD must fall permanently.
The distinction matters after the stronger US payroll report.
A firm Dollar response to US data could provide the retreat JPMorgan was waiting for without necessarily invalidating the bank’s broader Australian Dollar view.
Before the release, the desk had already shown reluctance to chase the pair near 0.72.
“NFPs are today, although with Waller drawing attention to next week’s CPI, I am a little less inclined to chase a surprise print today.”
The payroll surprise has shifted attention towards US inflation and the durability of Federal Reserve tightening expectations.
If those expectations strengthen, AUD/USD could be forced back towards JPMorgan’s entry levels.
Image: Australian dollar vs US Dollar chart for last 48 hours of the week. The 48-hour chart nevertheless shows that the Australian Dollar absorbed the payroll release relatively well.
AUD/USD briefly dropped below 0.7190 but recovered to close around 0.7204, near the upper end of its 0.7159-0.7214 range.
Why JPMorgan still likes the Australian Dollar The bank’s constructive stance has been supported by Australian rate expectations, resilient demand for commodity currencies and investor flows.
“AUDUSD moved above 0.72 for a second time this week while NZDUSD got a look above 0.59, although both have been trickling lower since London sat down.”
JPMorgan also reported real-money demand for the currency.
“Flow-wise, RM were large buyers of oz and, to a lesser extent, NZD yesterday, whereas systematics were LHS in AUD.”
The risk for prospective buyers is that 0.7080 never trades, leaving the bullish view without an entry.
The opposite risk is that a break below 0.7000 reflects more than a routine Dollar correction.
Between those outcomes, JPMorgan’s message is clear: stay constructive, but make the market come to the preferred price.
AUD/USD se drží poblíž 0,7165, ale rostoucí šance na zvýšení sazeb RBA i Fedu už tento měsíc tlačí pár pod tlak. Trh navíc počítá se silnými australskými daty a vyššími cenami ropy. Pár se přitom pohybuje jen mírně pod srpnovým maximem 0,7207.
Sell AUD/USD. Higher odds of both RBA and Fed hikes push the market toward tighter USD policy and less room for AUD to rally; strong Aussie data is already “priced,” while the article flags elevated inflation and renewed oil/energy pressure that can keep both central banks hawkish. Technicals also point to a bearish reversal (rising wedge convergence, PPO bearish crossover, RSI rolling over). Target 0.700 support.
Key Risk: A sharp risk-off move that weakens the USD (or a surprise dovish Fed/RBA shift) that drives AUD/USD back above 0.7207.
Brent-linked AUD
Sell AUD exposure via AUD/JPY (or AUD futures). The news ties the hawkish rate repricing to higher oil after US-Iran activity; that supports global growth but also keeps inflation sticky, which tends to keep JPY relatively supported versus high-beta AUD when rates are uncertain. With AUD/USD set up to break lower, AUD/JPY should follow on the same rate-and-risk repricing.
Key Risk: Oil spikes further and triggers a broad commodity/risk rally that lifts AUD/JPY despite the wedge/oscillator bearish setup.
The Australian dollar held firm today, September 3rd, as investors adjusted their RBA and Federal Reserve expectations for the year. The AUD/USD pair was trading at 0.7165, a few points below the August high of 0.7207.
Traders are bracing for interest rate hikes from the Federal Reserve and the Reserve Bank of Australia (RBA) happening as soon as this month.
Polymarket gives the odds of RBA’s rate hike happening in September rose to 67%. These odds jumped after the US and Iran resumed their kinetic activity, which led to higher oil prices.
Australia has also published strong macro numbers this week. An S&P Global report showed that the services PMI came in at 53.2 in August, higher than the expected 52.9. A PMI reading of 50 and above is usually a sign that a sector is growing. The composite PMI came in at 52.7, also higher than the expected 52.50.
Another report released on Wednesday showed that the Australian economy expanded by 2.1% in the second quarter, higher than the expected 1.8%. It grew by 0.4% in Q2 after growing by 0.3% in Q1 on a QoQ basis.
This growth happened even as the Reserve Bank of Australia (RBA) became the most hawkish central banks this year. It has already delivered three rate hikes this year, with officials leaving the door open for more hikes.
A key concern is that Australia’s inflation has remained at an elevated level in the past few months. This trend will likely continue now that the US and Iran have restarted their kinetic activity, leading to higher energy prices. Brent, the global benchmark, rose to $95.68, while the West Texas Intermediate (WTI) rose to $91.
The same situation is happening in the US, where odds that the Fed will hike rates this month have jumped to 55% on Polymarket. These odds soared after Kevin Warsh delivered a highly hawkish statement at the Jackson Hole Symposium.
In it, he hinted that the bank was concerned about the state of inflation, which has remained above the 2% target in the past five years.
Focus now shifts to the upcoming US nonfarm payrolls (NFP) report that will provide color on the labor market. Economists expect the data to show that the economy created over 80k jobs in August this year.
AUDUSD chart | Source: TradingView
The daily chart shows that the AUD/USD pair may be on the verge of a bearish reversal in the coming days. For one, it has formed a rising wedge pattern whose two lines are about to converge.
Also, the two lines of the Percentage Price Oscillator (PPO) have made a bearish crossover, while the Relative Strength Index is pointing downwards.
Therefore, the most likely scenario is where the AUD/USD pair falls, potentially to the key support of 0.700.
Goldman nyní čeká, že RBA v listopadu zvýší sazby o 25 bazických bodů na 4,60 % po červencovém inflačním překvapení. AUD/USD v srpnu stále zůstává o 1,7 % výše.
Goldman now expects an RBA hike to 4.60% in November after a broad July inflation surprise, adding fresh rate support to the Australian Dollar. The Australian Dollar to US Dollar (AUD/USD) exchange rate ended Friday at 0.7163, still 1.7% higher in August despite losing 0.45% after Warsh's Jackson Hole speech.
Latest — Exchange Rates:
Pound to Australian Dollar (GBP/AUD): 1.889531 (-0.01%)
Euro to Australian Dollar (EUR/AUD): 1.617018 (-0.15%)
Goldman Sachs has made a more important change underneath that price action.
“Australia's headline CPI increased 1.0%mom in July, with year-over-year growth easing 30bp to 3.5%yoy – above our and market expectations,” economists Andrew Boak, Will Maher and Oscar To said.
Underlying inflation was stronger as well.
“The ABS monthly trimmed mean measure increased by 0.5%mom in July,” while annual trimmed-mean inflation remained at 3.6%, “also above expectations”.
More troubling for the Reserve Bank was the breadth.
“Price pressures also broadened in July: market services inflation accelerated, and consumer durables… rose by more than we expected.”
Goldman consequently raised its third-quarter trimmed-mean forecast to 0.93% quarter-on-quarter and concluded that the surprise “takes further tightening from ‘quite possible’ to most probable”.
The policy call changed with it.
“We now expect the RBA to hike 25bp in November to 4.60%,” Goldman said, while stressing “a material risk of an earlier RBA rate hike in September.”
Reuters data show the inflation release initially drove AUD/USD to a 12-week high around 0.7183 and lifted the market-implied probability of a September move to 38% from 17%.
Friday's Dollar surge subsequently knocked AUD/USD lower, but it does not alter Goldman's domestic argument.
The next decisive releases are Australia's labour-market report and August CPI.
A second broad inflation surprise would make November increasingly difficult for the RBA to avoid and could revive the Australian Dollar's yield advantage.
Exchange Rates UK Research Our currency coverage draws on live market data, official economic releases and published bank research.
AUD/USD téměř nereagoval na zápis z RBA, který potvrdil debatu o dalším zvýšení sazeb, ale označil 4,35 % za dostatečně restriktivní úroveň. Pro zářijové rozhodnutí bude klíčovější středeční červencová CPI.
TL;DR: AUD/USD barely moved on RBA minutes that confirmed, but didn’t change, the existing hawkish-hold debate — the real signal was the Board’s openness to pre-emptive tightening based on monthly data alone, which keeps a September hike live even without the Q3 quarterly CPI, making Wednesday’s July print the more consequential test.
Minutes Confirm Debate, but Give Aussie Little New to Trade AUD/USD barely moved after minutes of RBA’s Aug. 10–11 meeting, slipping only modestly from recent 0.71790 high. Muted reaction made sense. Minutes confirmed what markets already understood from August’s hawkish hold: Board genuinely considered a 25bp hike, but ultimately judged policy at 4.35% “appeared sufficiently restrictive” and that there was still time to gather more evidence. Governor Michele Bullock has already said further tightening is “quite possible,” while Deputy Governor Andrew Hauser struck a somewhat more assertive tone last week. Minutes added detail to that debate without materially changing it.
More important was language around acting before inflation risks are fully confirmed. Members explicitly discussed whether it “may be appropriate to mitigate those risks somewhat by tightening monetary policy pre-emptively,” while several judged it “quite possible” that upside risks would crystallise and require further tightening. That leaves RBA with two live arguments: current policy may already be restrictive enough, but waiting becomes harder to justify if incoming inflation data suggest upside risks are beginning to materialise.
Wednesday’s CPI Is Where Repricing Risk Begins That makes Wednesday’s July CPI much more consequential than Tuesday’s minutes. It is the only monthly inflation report RBA will receive before Sept. 28–29 meeting, with August CPI not due until Sept. 30. Board itself specifically highlighted incoming monthly inflation and labour-market reports as important inputs before its next decision. There will therefore be no second inflation print available to confirm—or offset—whatever signal July data deliver.
That reference to monthly inflation data is important in its own right. Combined with Board’s willingness to consider pre-emptive tightening, it implicitly suggests policymakers do not necessarily need to wait for full Q3 quarterly CPI before acting. If monthly data show inflation risks strengthening, September meeting can remain live even though complete quarterly inflation picture will not yet be available. In other words, RBA has left itself room to respond to emerging evidence rather than requiring confirmation from traditional quarterly CPI cycle.
Labor side already points in a softer direction. July employment fell 15.8K, while unemployment rose from 4.4% to 4.5%. Another labour report is due only days before September meeting, giving Board a fresh employment read. Inflation calendar is less forgiving. A hot CPI would not guarantee a September hike, but it would raise cost of waiting and strengthen case for acting before Q3 CPI is available. A softer reading would reinforce argument that 4.35% is already doing enough and give policymakers more reason to use time rather than another rate increase.
ActionForex’s Technical View on AUD/USD: Hot CPI Could Put 0.72770 Back in Sight AUD/USD technical setup reflects that policy tension. Recovery from 0.68640 remains constructive, with a higher low at 0.69210 followed by a break above 0.70260 and an advance to 0.71790. Pair is now consolidating just below nearby 161.8% projection of 0.6864 to 0.7026 from 0.6921 at 0.7183, while daily momentum remains positive.
A hotter-than-expected CPI would strengthen case for another RBA hike and, crucially, keep September tightening firmly in play without waiting for Q3 CPI. That could drive AUD/USD through 0.71790 toward 0.72770 cycle high. But a sustained break of 0.72770 would probably require cooperation from Dollar side as well. DXY has spent the past two sessions consolidating rather than extending its broader decline, so cleanest bullish combination would be sticky Australian inflation alongside renewed USD weakness.
By contrast, an in-line or softer CPI could trigger a deeper pullback toward 0.70650. As long as that support holds, broader recovery from 0.68640 would remain intact and weakness would look more like consolidation than trend reversal. Minutes told markets RBA can afford to wait, but they also suggested it does not have to wait for quarterly CPI if monthly evidence becomes convincing. Wednesday’s CPI will show whether September stays merely possible—or becomes a much more immediate policy risk.
Key Takeaways RBA minutes confirmed the Board seriously considered a hike but judged 4.35% sufficiently restrictive for now, adding detail to the existing debate without shifting it. The Board explicitly discussed pre-emptive tightening, meaning it may act on monthly CPI data alone without waiting for the full Q3 quarterly print. Wednesday’s July CPI is the only monthly inflation read before the September 28-29 meeting, making it more consequential for policy than the minutes themselves. Weaker labor data (July employment -15.8K, unemployment up to 4.5%) already points dovish, leaving the inflation print as the clearer swing factor for September. AUD/USD holds a positive bias above 0.7183 resistance toward 0.7277, but a sustained break likely needs both a hot CPI and renewed Dollar weakness; a soft print risks a pullback toward 0.7065.
ActionForex
ActionForex.com was set up back in 2004 with the aim to provide insightful analysis to forex traders, serving the trading community for two decades. We started providing only a daily and a mid-day report, now known as Action Insights. Gradually, we added a lot more in-house contents to the site. Technical Outlook section was expanded to cover more pairs. In addition to that, Top Movers, Heat Map, Pivot Point Charts and Pivot Meters, Action Bias and Volatility Charts, are tools used by traders from all over the world.
AUD/USD vystoupal na nové maximum od začátku června a za den přidává téměř 0,50 %. Dolar slábne poblíž tříměsíčního minima kvůli nižším sázkám na bezprostřední zvýšení sazeb Fedu.
The AUD/USD pair regains positive traction following the previous day's dismal Aussie jobs data-led modest fall and climbs to a fresh high since early June during the first half of the European session. Spot prices currently trade just below mid-0.7100s, up nearly 0.50% for the day, and remain on track to register gains for the seventh week in a row amid a supportive fundamental backdrop.
The US Dollar (USD) languishes near a three-month low, touched on Thursday, amid receding bets for an immediate rate hike by the Federal Reserve (Fed), which, in turn, is seen as a key factor supporting the AUD/USD pair. Bulls, meanwhile, seem rather unaffected by geopolitical uncertainties stemming from the US-Iran standoff over the Strait of Hormuz, suggesting that the path of least resistance for spot prices remains to the upside.
From a technical perspective, the latest leg up confirms a fresh breakout above the 61.8% Fibonacci retracement level of the May-June decline. Moreover, the Relative Strength Index (14) near 67 suggests stretched but still constructive momentum and is backed by a mildly positive Moving Average Convergence Divergence (MACD) reading above zero. The set-up, in turn, further validates the near-term positive outlook for the AUD/USD pair.
Meanwhile, the 78.6% Fibo. retracement at 0.7188, which might cap the advance for now. A sustained move beyond the said hurdle is needed to open the way toward higher recovery targets. On the downside, initial support is located at the 61.8% retracement at 0.7119, ahead of a stronger structural floor formed by the 50.0% retracement at 0.7070 and the nearby 100-day SMA at 0.7069. A break below this cluster would likely trigger a deeper pullback toward the 38.2% level at 0.7021 and the 23.6% retracement at 0.6961, if selling accelerates.
(The technical analysis of this story was written with the help of an AI tool. Know more.)
AUD/USD daily chart
Australian Dollar Price This week The table below shows the percentage change of Australian Dollar (AUD) against listed major currencies this week. Australian Dollar was the strongest against the US Dollar.
USDEURGBPJPYCADAUDNZDCHFUSD-1.12%-0.91%-0.25%-0.80%-0.81%-1.27%-1.48%EUR1.12%0.36%0.87%0.32%0.27%-0.16%-0.36%GBP0.91%-0.36%0.59%-0.01%-0.09%-0.52%-0.77%JPY0.25%-0.87%-0.59%-0.53%-0.61%-1.03%-1.25%CAD0.80%-0.32%0.01%0.53%-0.07%-0.50%-0.74%AUD0.81%-0.27%0.09%0.61%0.07%-0.43%-0.68%NZD1.27%0.16%0.52%1.03%0.50%0.43%-0.26%CHF1.48%0.36%0.77%1.25%0.74%0.68%0.26% The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Australian Dollar from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent AUD (base)/USD (quote).
AUD/USD po slabých australských datech z trhu práce krátce klesl směrem k 0,7111, ale později se vrátil zhruba na 0,7126. Míra nezaměstnanosti stoupla na 4,5 % a zaměstnanost klesla o 15 800.
The Australian Dollar fell immediately after a weak employment report before recovering as broader US Dollar softness limited the damage to AUD/USD. The Australian Dollar came under pressure after Australia's July labour-market report showed an unexpected fall in employment and unemployment at its highest level in almost five years.
Employment dropped by 15,800 against expectations for a gain of around 15,000, while the unemployment rate rose to 4.5%.
Image: AUD crosses today Australian jobs data The Australian Dollar to US Dollar (AUD/USD) exchange rate fell towards 0.7111 immediately after the release before recovering to around 0.7126 later in the morning.
At that later level, the pair was marginally higher on the day, underlining the importance of distinguishing the initial Australian data reaction from subsequent US Dollar weakness.
Jobs Data Eases Pressure on RBA Full-time employment still increased by 16,300, but participation slipped to 66.9% and total hours worked fell 0.6%.
The softer headline reduces pressure on the Reserve Bank of Australia to tighten policy again quickly.
Westpac economist Ryan Wells had already highlighted “the rising trend in unemployment and underemployment” as evidence that labour-market slack was building.
Oxford Economics Australia chief economist Ben Udy said the July figures were slightly weaker than the RBA had expected and, alongside slower wage growth, reduced near-term pressure for another increase.
Markets remain divided over whether the RBA will need another increase later this year, particularly with inflation still uncomfortable.
Image: AUD/USD intraday chart For the AUD/USD exchange rate, the immediate support zone sits around 0.7100, while the August high near 0.7129 is the first upside test.
A renewed break below 0.7100 would suggest the labour-market disappointment is beginning to dominate the broader Dollar story.
Exchange Rates UK Research Our currency coverage draws on live market data, official economic releases and published bank research.
TL;DR: AUD/USD has broken out on external tailwinds — a weaker Dollar and rebounding risk appetite — but Thursday’s jobs report lands in the middle of a genuine split between economists who think the RBA is done hiking and an RBA that keeps saying otherwise.
Aussie Has External Momentum — Now Australia Needs to Contribute AUD/USD has already received almost everything it could ask for from outside Australia. The Dollar is weakening as markets scale the Fed path back toward only “one and a bit” additional hikes through mid-2027. Regional risk appetite has rebounded strongly, with the KOSPI more than 30% above its July trough and the Nikkei roughly 14% higher. Against that backdrop, AUD/USD extended its rally from 0.6864 and broke through its near-term channel ceiling, giving the first technical sign that the advance is accelerating.
The question now is whether domestic fundamentals can join the move. Thursday’s July employment report arrives with consensus around just 12k jobs growth, a dramatic slowdown from June’s 76.3k, while the unemployment rate is expected to hold at 4.4%. That would normally look like routine normalization after an outlier. This time, however, the labor data sit directly in the middle of an unresolved disagreement over whether the RBA’s tightening cycle is finished.
Economists Say the RBA Is Done. The RBA Hasn’t Said That. All four major banks now have no further 2026 hike as their base case, with Westpac dropping its August tightening call after softer Q2 inflation data. But the RBA’s own language remains conspicuously hawkish. The August SoMP retained a commitment to increase the cash rate further “if upside risks materialise.” Governor Michele Bullock said at the July 28 Anika Foundation speech that the Board was “prepared to act as required.” After the August hold, Assistant Governor Christopher Kent went further at the Reuters Next event on August 13, saying inflation risks “lean firmly to the upside” and the cash rate “could rise further” if those risks materialise.
That consistency before and after the decision matters. It suggests the hike bias is deliberate rather than a sentence left behind by inertia. At the same time, the rates market hasn’t moved all the way toward bank economists’ conviction: the SoMP cited pricing consistent with roughly a 50% chance of another hike by year-end. ANZ also continues to flag a November hike as a live risk despite its hold base case. In other words, economists are leaning heavily toward “done,” but money markets remain genuinely divided.
One Jobs Report Already Proved It Can Change the Rate Story This year’s employment series has been unusually volatile: -18.6k in April, +43.9k in May, and +76.3k in June. The June surge, almost five times the expected increase, helped send year-end hike odds from around 78% to 97% before the August meeting. The RBA still chose to hold, and the current roughly 50% year-end probability reflects the reset since then. But the precedent is clear: one labor report has already moved RBA pricing materially this cycle.
That gives Thursday a genuine two-sided setup. Another large beat could challenge the hold-through-2026 consensus, revive hike pricing, and potentially add domestic rate support to AUD/USD’s existing Dollar and risk-sentiment tailwinds. A result near or below consensus would instead strengthen the case that June was an outlier and pull market pricing closer to the Big Four view. Neither outcome should be read in isolation, however — jobs this week and CPI next week are better treated as a paired test: only a combination of resilient labor demand and renewed inflation pressure would make the September hike case substantially harder to dismiss.
ActionForex’s Technical View on AUD/USD The chart setup already reflects rising optimism. AUD/USD’s rally from 0.6864 has broken above its near-term channel ceiling, signaling upside acceleration. As long as 0.7042 minor support holds, the next objective sits at the 161.8% projection of 0.6864 to 0.7026 from 0.6921, at 0.7183.
The larger trend remains bullish as well. AUD/USD continues to hold well above the 38.2% retracement of the 0.5913 to 0.7277 rise, at 0.6756, leaving the year-long advance from the 2025 low intact. Price action from 0.7277 is treated as corrective, though it’s too early to rule out another down leg before the larger uptrend resumes.
For now, holding above the 55-day EMA near 0.7023 keeps a retest of 0.7277 favored. The Aussie has already broken higher on external support; Thursday will show whether Australia can supply the next reason to keep buying.
Key Takeaways AUD/USD’s breakout has so far been driven entirely by external factors: fading Fed hike odds and a strong regional risk-appetite rebound. All four major Australian banks expect no further RBA hikes in 2026, but RBA officials, including Bullock and Kent, have kept using hawkish language even after the August hold. Rates markets remain split from bank economists, pricing roughly a 50% chance of another hike by year-end versus the Big Four’s near-unanimous “done” call. June’s 76.3k jobs surge already proved a single report can swing RBA pricing sharply, from 78% to 97% hike odds, showing Thursday’s data carries real two-sided risk. AUD/USD holds above 0.7042 support with 0.7183 as the next objective; the broader uptrend from 2025 stays intact above the 0.6756 retracement level. Related Reading Dollar Index Faces Imminent Breakdown Risk as Fed Hike Path Shrinks. RBA’s Kent Says Tightening Is Working, but Policy Restraint Remains Hard to Gauge RBA Accepts Softer Inflation but Still Leaves Scope for One More Hike
ActionForex
ActionForex.com was set up back in 2004 with the aim to provide insightful analysis to forex traders, serving the trading community for two decades. We started providing only a daily and a mid-day report, now known as Action Insights. Gradually, we added a lot more in-house contents to the site. Technical Outlook section was expanded to cover more pairs. In addition to that, Top Movers, Heat Map, Pivot Point Charts and Pivot Meters, Action Bias and Volatility Charts, are tools used by traders from all over the world.
The Reserve Bank of Australia held the cash rate at 4.35%, with all nine board members voting to leave policy unchanged. The decision itself was expected. The more useful signal came from why the Bank chose to pause.
Inflation is still too high, but consumer spending, housing and the labour market are beginning to cool. After three rate hikes this year, the RBA now wants to see how much of that tightening is still working through the economy before deciding whether another increase is needed.
That leaves the RBA in an awkward middle ground: not enough evidence to hike again immediately, but not enough disinflation to declare the tightening cycle finished. For AUD, the next move is therefore a confirmation story rather than a simple hawkish-rate story.
The RBA is pausing to assess, not declaring victoryThe latest statement suggests the RBA believes tighter policy is starting to have a real effect. Trimmed mean inflation remains elevated, but softer consumer spending, cooler housing conditions in some capital cities and a softer labour market all point to demand losing some momentum.
That is why the hold should not be read as a dovish pivot. The Bank can keep policy restrictive while waiting for the lagged effect of earlier hikes. If inflation remains sticky, or global energy risks keep price pressures elevated, the option of another hike remains open.
For AUD, this is supportive at the margin, but it is not a one-way bullish signal. The currency still has to prove that the RBA backdrop is strong enough to overcome resistance and whatever the US dollar does next.
AUD/USD now has to clear 0.704-0.708AUDUSD is now testing the 0.704-0.708 resistance area on the daily chart. Price has pushed into a previous high range, but the latest candles are beginning to stall and momentum has failed to confirm the higher high.
From here, the US side of AUDUSD becomes the next immediate driver, with US CPI due tomorrow on 12 August.
A hotter US inflation print would make it harder for AUDUSD to break higher. The first pullback references sit near the channel midline around 0.700 and the lower channel area near 0.695. A clean channel failure would expose the larger 0.683-0.687 support zone.
A cooler US CPI print would give the pair more room to break above 0.708. If price can close above that area and hold it on a retest, the next references are around 0.718 and then 0.723-0.727.
Fundamentally, the RBA is in a much more comfortable position than earlier in the year.
Softer housing activity, lending, consumer spending and labour conditions suggest its previous hikes are beginning to cool demand, which should gradually ease inflation pressure. Technically, AUDUSD may also be forming bearish divergence at resistance.
RBNZ shows a hawkish policy is not enoughThe RBNZ offers a useful warning against treating a hawkish central bank as an automatic bullish currency signal. It raised the Official Cash Rate to 2.50% on 8 July and said further increases are likely, although the timing remains uncertain.
Even so, NZD/USD remains below its long-running weekly downtrend and beneath the 0.603-0.612 resistance area. The pair has not converted renewed RBNZ tightening into a structural breakout of its trendline resistance.
That makes NZD/USD a control case for the RBA story. Domestic policy can support a currency, but relative growth, commodity exposure, the US dollar and existing price structure still decide how much of that support reaches the exchange rate.
AUD/NZD may be reaching a turning pointRemoving the US dollar from the equation, the RBA may finally be starting to see its aggressive tightening cycle pay off.
Housing activity and new lending have cooled, consumer spending has slowed, and labour conditions have softened, giving the Bank more reason to pause and assess the impact of the three hikes delivered between February and May.
The RBNZ, on the other hand, is at a much earlier stage. It only restarted tightening in July, raising the OCR to 2.50%, with further hikes still likely. That timing gap matters because Australia may now be moving into the later stages of its tightening cycle just as New Zealand begins applying more pressure.
If that gap starts to narrow, so could Australia’s relative rate advantage. That raises the risk that AUDNZD is approaching a turning point rather than simply extending higher.
The idea that AUD may weaken against the NZD is supported technically as well.
The pair has tapped a major trendline resistance extending from 2019 with almost perfect precision. The current pullback could still form a bull-flag consolidation, but failure to recover would leave room for a deeper retracement towards roughly 1.162-1.169, where the trading volume weighted average price anchored from the start of the rally sits.
AUD/USD zůstává pod 0,7000 a trh čeká na jasnější signál. Pár se drží nad 200denním klouzavým průměrem kolem 0,6900, ale opakovaně naráží na rezistenci.
AUD/USD waits for a clearer signalDirectional bias: Neutral to bullish above 0.6900, although repeated difficulty clearing 0.7000 leaves the pair exposed to another rejection.
Preferred approach: Patience may offer a better risk-reward profile than chasing the pair immediately below resistance. A confirmed break above the 0.7000 threshold or a pullback that holds around the 200-day SMA would provide a cleaner setup.
Bullish trigger: A sustained move above 0.7000, ideally supported by firm Australian labour data, stronger expectations of another RBA rate increase, lower US yields or an improvement in risk appetite.
Bearish trigger: Another failure at 0.7000, accompanied by renewed US Dollar strength or a generalised deterioration in market sentiment.
Key invalidation level: A daily close below the 200-day SMA around 0.6900 would undermine the broader constructive structure and increase the risk of a deeper retracement in the short-term horizon.
Three paths from the 0.7000 crossroadsBase case: The range holds
AUD/USD could remain trapped between the 0.7000 psychological barrier and the 200-day SMA just above 0.6900 while traders wait for a sufficiently strong catalyst.
Australia’s relatively solid domestic fundamentals and the Reserve Bank of Australia’s (RBA) cautious stance should discourage aggressive selling. At the same time, persistent demand for the Greenback and geopolitical uncertainty could prevent an immediate breakout.
Until either boundary gives way, spot may be better treated as a side-lined trade than a convincing directional move.
Bull case: Buyers establish a foothold above 0.7000
A convincing break above 0.7000 would suggest that buyers have absorbed the selling pressure surrounding this closely watched threshold.
The breakout would carry greater conviction if supported by:
Firmer-than-expected Australian data releases.A stable or lower Unemployment Rate.Increased expectations of another RBA rate hike.Lower US yields and a softer US Dollar.An improvement in risk-linked sentiment.Under this scenario, the next important medium-term target would emerge around 0.7200, followed by the 2026 ceiling near 0.7280.
The sizeable build-up of speculative AUD shorts could add fuel to the move if a confirmed breakout forces bearish traders to unwind their positions.
Bear case: Another rejection opens the door to 0.6900
A fresh failure around 0.7000 could bring sellers back into the market, particularly if the Greenback regains momentum or global risk appetite deteriorates.
The next major test would then be the 200-day SMA around 0.6900. A daily close below this area would damage the wider bullish structure and increase the probability of a deeper correction.
Once that support gives way, previous resistance and consolidation zones below 0.6900 could return to focus.
Australia’s economy continues to hold its groundAustralia’s domestic backdrop remains relatively healthy, supported by firm demand, positive growth and a resilient labour market.
July business surveys reinforced that picture. The Manufacturing PMI improved to 52.0 from 51.5, while the Services PMI rose to 53.0 from 50.5, leaving both sectors comfortably in expansionary territory.
The June labour-market report was also encouraging. The Unemployment Rate held steady at 4.4%, while Employment Change jumped by 76.3K following a revised 44K increase in May.
Still, the picture is not uniformly positive. Australia recorded an A$3.018 billion trade deficit in May, reversing April’s A$1.383 billion surplus. Economic growth also slowed to 0.3% quarter-on-quarter in the first three months of 2026, down from 0.9%, while annual growth held at 2.5%.
Overall the figures suggest a resilient economy but perhaps not strong enough on its own to trigger a sustained breakout in AUD/USD.
Inflation leaves the RBA with unfinished businessAustralian headline inflation eased to 3.9% in the second quarter from 4.1%. Underlying price pressures, however, remained uncomfortable. Both the Trimmed Mean and Weighted Median measures rose to 3.6% from 3.5% in the previous quarter.
Consumer inflation expectations offered some relief, falling to 4.7% in July from 5.5%, according to the Melbourne Institute. Even so, inflation remains too high for the RBA to declare victory.
The central bank left its Official Cash Rate (OCR) unchanged at 4.35% in June and maintained a cautious message. Policymakers warned that further tightening could still be required if inflation proves more persistent than expected.
Governor Michele Bullock struck a more balanced tone. While keeping the possibility of another rate increase alive, she suggested there was no immediate need to tighten again as the economy was broadly evolving in line with expectations.
Markets expect the RBA to remain on hold at its August meeting while continuing to price the possibility of additional tightening before year-end. So far, nearly 15 basis points of extra tightening are pencilled in by the turn of the year.
That stance provides the AUD with some domestic support, but it is not necessarily enough to trigger an immediate rally. Further gains may require incoming data to strengthen the case for another rate increase.
China steadies but offers little additional liftChina remains an important influence on the Australian currency, although it is currently providing stability rather than a powerful tailwind.
The Chinese economy expanded by 4.3% YoY in the April-June period, Industrial Production rose by 5.3% in the year to June, and Retail Sales increased by a more modest 1.0%.
Business surveys suggest that activity is stabilising. The official Manufacturing and Services PMIs remained slightly above the 50 threshold, while private-sector gauges continued to signal expansion.
China’s trade surplus also widened to $125.62 billion in June from $105.4 billion, supported by stronger imports and exports.
Meanwhile, the People’s Bank of China (PBoC) left its Loan Prime Rates (LPR) unchanged, keeping the one-year rate at 3.00% and the five-year rate at 3.50%.
China is therefore neither delivering a major boost nor creating a significant drag. Unless the data reveal a clearer acceleration or deterioration, Chinese releases may generate short-term volatility without establishing a lasting direction for the pair.
Bearish positioning remains heavy, but momentum is fadingThe speculative mood on the Australian Dollar stayed bearish in the week ended July 28. Commodity Futures Trading Commission (CFTC) data showed net short positions rose to almost 40K contracts from 37.7K a week before.
However, the weekly increase in bearish exposure has decelerated to around 2.3K contracts from 7K previously. That said, the non-commercial players are still building on their downside positions, but with less urgency than earlier this summer.
Open interest also increased slightly to around 229.8K contracts from just above 225K, indicating a slight increase in market participation. In addition, speculative exposure decreased as well to -17.4% (from -16.7%).
The broader trend points to a similar loss of momentum. Indeed, the 4-week change improved to -22.3K contracts from -24.7K, suggesting that cumulative bearish flows are gradually cooling.
Overall, speculators remain firmly bearish on the Aussie, but that view is becoming more established than aggressive. This means the AUD position is increasingly reliant on incoming economic data.
It also creates an interesting asymmetry. Disappointing data could reinforce the prevailing bearish bias, but a convincing improvement in the outlook could trigger a sharper reaction as crowded short positions are unwound.
Jobs data take centre stageAustralia’s July Labour Force report will be the next major domestic test for the Australian Dollar. The release could influence expectations for the RBA’s next move and determine whether AUD/USD can establish itself above 0.7000.
Stronger-than-expected labour data
A solid increase in employment, particularly full-time employment, combined with a stable or lower jobless rate would reinforce the view that the labour market remains tight.
Firm participation and hours-worked figures would add credibility to the headline result. Such an outcome could strengthen expectations of another RBA rate increase and support a sustained move above 0.7000 of the pair.
A broadly balanced report
Employment growth close to expectations, accompanied by little change in unemployment or participation, would probably leave the RBA outlook largely unchanged.
In that case, AUD/USD could remain confined between resistance around 0.7000 and the 200-day SMA just past 0.6900, with its direction determined primarily by the US Dollar and global risk sentiment.
A clear deterioration in the labour market
Weak or negative employment growth, particularly alongside a rise in the Unemployment Rate, would raise questions about the resilience of the Australian economy.
A drop in hours worked or a result driven mainly by part-time employment would make the report look even softer. This could reduce expectations of further RBA tightening and leave spot vulnerable to a renewed test of 0.6900.
Participation will require careful attention. A lower Unemployment Rate caused by people leaving the labour force would be less encouraging than the headline figure might initially suggest.
Beyond the domestic data, traders should continue to monitor US yields, Federal Reserve expectations, Chinese developments, global risk appetite and geopolitical headlines.
Technical landscapeIn the daily chart, AUD/USD trades at 0.6994, holding above the 200-day simple moving average (SMA) at 0.6913 but still capped by the 55-day SMA at 0.7019 and the 100-day SMA at 0.7053, which keeps the near-term tone neutral-to-bearish. Momentum is modestly constructive, with the Relative Strength Index (14) hovering near 51, while the Average Directional Index (14) around 15 suggests a weak, non-trending environment where price is more likely to consolidate beneath these moving average barriers than to embark on a decisive directional move.
On the topside, immediate resistance is clustered at the short-term SMAs, with the 55-day SMA at 0.7019 followed by the 100-day SMA at 0.7053, ahead of a horizontal cap near 0.7079; higher up, the 0.7278–0.7283 region and then 0.7661 mark more substantial medium-term hurdles. On the downside, initial support aligns with the 200-day SMA at 0.6913, before the horizontal floor at 0.6833, while deeper retracements would expose 0.6660 and 0.6593, with 0.6414 and 0.6373 acting as longer-term bearish objectives if selling pressure resumes.
(The technical analysis of this story was written with the help of an AI tool. Know more.)
The line in the sand remains 0.6900AUD/USD retains a constructive medium-term structure above its 200-day SMA, but the immediate outlook remains uncertain while the pair struggles to secure a foothold above 0.7000.
The most attractive setup remains conditional. Confirmed acceptance above 0.7000 would favour additional gains and could trigger a positioning-driven short squeeze. Another rejection, however, would leave the pair exposed to a return toward 0.6900.
Until one of these boundaries breaks, AUD/USD remains caught between supportive Australian fundamentals and an external backdrop still dominated by the US Dollar, geopolitical uncertainty and only moderate support from China.
Employment FAQs Labor market conditions are a key element to assess the health of an economy and thus a key driver for currency valuation. High employment, or low unemployment, has positive implications for consumer spending and thus economic growth, boosting the value of the local currency. Moreover, a very tight labor market – a situation in which there is a shortage of workers to fill open positions – can also have implications on inflation levels and thus monetary policy as low labor supply and high demand leads to higher wages.
The pace at which salaries are growing in an economy is key for policymakers. High wage growth means that households have more money to spend, usually leading to price increases in consumer goods. In contrast to more volatile sources of inflation such as energy prices, wage growth is seen as a key component of underlying and persisting inflation as salary increases are unlikely to be undone. Central banks around the world pay close attention to wage growth data when deciding on monetary policy.
The weight that each central bank assigns to labor market conditions depends on its objectives. Some central banks explicitly have mandates related to the labor market beyond controlling inflation levels. The US Federal Reserve (Fed), for example, has the dual mandate of promoting maximum employment and stable prices. Meanwhile, the European Central Bank’s (ECB) sole mandate is to keep inflation under control. Still, and despite whatever mandates they have, labor market conditions are an important factor for policymakers given its significance as a gauge of the health of the economy and their direct relationship to inflation.
UBS expects the Australian Dollar to strengthen steadily over the coming year, with AUD/USD forecast at 0.73 by September and 0.76 by June 2027. The Australian Dollar to US Dollar exchange rate (AUD/USD) ended July at 0.7026, having gained 1.65% over the month and more than 5% since the start of the year.
That leaves the pair back above 0.70 after a difficult June, when AUD/USD fell 3.73% and briefly traded below 0.69. See our full history here.
UBS sees the recovery extending well beyond current exchange rate levels.
Its latest global forecasts put AUD/USD at 0.73 in September 2026, 0.74 in December, 0.75 in March 2027 and 0.76 by June.
The final target implies upside of just over 8% from the latest close.
The shape of the forecast matters.
UBS is not looking for one sudden surge.
It expects the pair to rise by roughly one cent in each quarter, pointing to a broader improvement in the Australian Dollar backdrop alongside a gradual weakening of the US currency.
We think that makes the 0.73 September target the key first test.
If AUD/USD can reach and hold that level, the later forecasts at 0.74, 0.75 and 0.76 become much easier to justify. If it fails well before then, the whole path starts to look more vulnerable.
The bank’s wider currency table also supports the view that this is partly a Dollar story.
UBS expects both EUR/USD and GBP/USD to rise over the same period, suggesting it sees a broad retreat in the US Dollar rather than an Australian Dollar move driven by domestic factors alone.
That distinction is important after softer Australian inflation reduced expectations for another near-term Reserve Bank of Australia rate rise.
The absence of an immediate hike removes one potential source of support for the Aussie, but it does not rule out further gains if US yields fall and the Federal Reserve becomes less restrictive.
A favourable global backdrop would help as well.
The Australian Dollar tends to perform better when equity markets are firm, commodity demand is improving and investors are prepared to hold more risk-sensitive currencies.
In our view, UBS’s forecast assumes those external forces will prove strong enough to outweigh any fading support from Australian interest rates.
The pair still has technical work to do before the first target comes into view.
AUD/USD closed July near 0.7026, above the rising 20-day moving average and around the declining 50-day average.
That is a clear improvement from late June, when the exchange rate fell towards 0.6880, but it is not yet a decisive medium-term breakout.
The immediate obstacle is the July high around 0.7044.
A move through 0.7050 would strengthen the recovery and bring 0.7100 back into focus.
Beyond there, resistance is likely around 0.7180-0.7200, followed by the May peak at 0.7277.
We would treat a break above 0.7277 as the point at which the UBS forecast starts to look technically credible.
That would complete the recovery from June’s decline and leave the market within reach of 0.73.
Image: AUD/USD three-month chart showing support near 0.7000, resistance around 0.7045 and the May high at 0.7277 The broader 2026 trend remains constructive, but the May high still guards the path to UBS’s first target The year-to-date chart is more positive than the shorter three-month view.
AUD/USD began 2026 near 0.6670 and has since gained 5.34%.
The pair rallied strongly through January, traded above 0.72 during the spring and reached a year-to-date high at 0.7277 in May.
The subsequent decline was sharp, but the exchange rate held well above its January low before recovering through July.
That leaves the broader upward structure intact.
The 20-day moving average has turned higher, while the 50-day average has begun to flatten.
A sustained hold above 0.70 would keep the recovery on course and increase the likelihood of another test of the spring highs.
Initial support is located around 0.7000, followed by the 20-day average near 0.6970.
A break beneath 0.6970 would weaken the near-term picture and expose the July support zone around 0.6940, with the late-June low near 0.6880 providing the more important downside level.
We would view a move back below 0.6970 as a warning that the July recovery is losing momentum.
Image: AUD/USD year-to-date chart showing the rise from 0.6670, May peak near 0.7277 and July recovery above 0.70 Share article
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UBS’s 0.76 forecast ultimately rests on more than the Australian Dollar story.
A move that far would require a sustained improvement in global risk appetite, supportive commodity conditions and a weaker US Dollar.
The first two targets look achievable if AUD/USD can maintain its position above 0.70 and clear the May high.
The longer-term move towards 0.76 would require a more convincing Dollar decline and a clear break from the broad range that has contained the pair since February.
For now, the technical tone has improved, but the exchange rate remains in recovery rather than full breakout mode.
A close above 0.7277 would materially strengthen the bullish case and place UBS’s 0.73 September forecast within reach.
AUD/USD včera vzrostl o více než 1 % a dnes se dostal na intradenní měsíční maximum 0,7045. Růst podporují vyšší očekávání sazeb RBA a slabší americký růst.
Higher-for-longer RBA interest rate expectations, persistent domestic inflation, and widening yield differentials against the U.S. Federal Reserve continue to fuel the currency's upward trajectory Broader risk-on sentiment is adding tailwinds, as investors favor growth-sensitive, higher-yielding currencies like the Aussie over safe havens amid improving global market mood The RBA's August 11 decision and upcoming US data could quickly reverse momentum The Australian dollar experienced significant gains this week. Yesterday, it rose over 1% against the US dollar, marking one of its most substantial single-day movements this year. This upward trend continued today, reaching an intraday monthly high of 0.7045.
Zoom out, and the pair is up roughly 9% over the past twelve months. So what’s behind this fresh burst of momentum, and is it something traders should lean into or treat with caution?
What Is Driving this Jump? The main reason for the Aussie dollar’s quick rise is the growing gap in monetary policy between Australia and the United States.
Back home, Reserve Bank of Australia (RBA) Governor Michele Bullock again took a hawkish tone. She warned that underlying inflation is still too high, meaning more interest rate hikes aren’t off the table.
The official RBA Monetary Policy Statement confirms the central bank is determined to bring inflation back to its target. They’re keeping the official cash rate at a high 4.35%. This firm approach has made markets expect a longer period of tight policy compared to other G10 countries.
Concurrently, the US dollar faced headwinds following macroeconomic reports showing a distinct deceleration in second-quarter US GDP growth.
The combination of weaker US economic growth figures and expectations of future monetary easing by the Federal Reserve has put downward pressure on US dollar yields. This situation is prompting a redirection of capital towards commodity-linked currencies, such as the Australian dollar, which offer higher yields.
Secondary support for the Australian dollar comes from commodity prices and global risk appetite. Australia’s export sector is closely tied to industrial metals and energy. Consequently, any improvement in global market sentiment generally benefits the Australian dollar.
Is It Sustainable? That’s the harder question. The rate-differential argument holds only as long as the data keeps cooperating. A hotter-than-expected US inflation print or a surprisingly resilient jobs report could quickly revive Fed-hawkish bets and cap the Aussie’s gains.
On the Australian side, the RBA’s next decision on August 11 is a real event risk. Any indication of concern regarding the currency’s current strength or a resurfacing of growth anxieties could rapidly shift market sentiment. In the near-term, the price range of 0.7045-0.7065 is likely to be the key resistance level to monitor.
What Traders and Investors Should Consider For short-term traders, this market movement appears driven by specific data points and upcoming events, rather than a fundamental change in valuation. Therefore, careful position sizing in anticipation of the RBA announcement and the next US inflation and payrolls data releases is more critical than attempting to capitalize on the immediate breakout.
For longer-term investors, including those with Australian equity or currency exposure, it’s worth remembering not to overreact to a single week’s move. Rate-differential shifts like this can unwind quickly if either central bank changes its guidance.
Why has the Australian dollar risen sharply against the US dollar?
A shifting interest-rate differential is driving it, and markets now expect a more dovish Fed while the RBA looks set to hold rates through 2026.
Should investors increase AUD exposure immediately?
A measured approach is preferable. Confirmation of the breakout and favourable upcoming data would strengthen the case for adding positions.
Will the Reserve Bank of Australia increase interest rates again soon?
While the RBA remains hawkish, recent cooling inflation makes an extended rate hold much more likely.
Asian FX intervention may not be finished yet BOJ surprise hike risk has increased marginally Softer US data adds to dollar pressure AUD/USD and NZD/USD break to fresh highs AUD/USD and NZD/USD ripped higher on Friday, fuelled by broad-based US dollar weakness following apparent coordinated intervention from Asian foreign exchange authorities, softer-than-expected US economic data and a surge in risk appetite after strong earnings from Microsoft and Amazon.
Coordinated intervention rattles the US dollar The biggest driver behind the Australian and New Zealand dollars' outperformance was suspected intervention by Japanese authorities, likely undertaken in coordination with South Korean authorities and with at least tacit support from the United States. The move came with the US dollar already under pressure after the Fed opted against raising rates on Wednesday, providing an ideal backdrop to maximise the impact.
Source: TradingView
An important consideration for traders on Friday is that intervention often doesn't occur in one sitting. Earlier this year, Japanese authorities stepped into the market over several sessions rather than relying on a single operation. If authorities return to the market again, particularly around the Bank of Japan policy decision later in the session, it would point to renewed upside risks for AUD/USD and NZD/USD.
Softer US data adds to dollar headwinds Amplifying the effectiveness of intervention, US economic data broadly disappointed on Thursday. Core PCE inflation rose 0.1% in June, below the 0.2% expected, while the annual rate eased from 3.4% to 3.3%. The unrounded increase was 0.14%, meaning the downside surprise was marginal rather than dramatic.
Accompanying personal income and spending figures were also disappointing. Personal income rose just 0.2%, undershooting expectations, while personal spending increased 0.3%. With spending continuing to outpace income, the household savings rate fell to 2.7%, its lowest level in four years. That questions the sustainability of the strong rebound in consumer spending seen during the June quarter.
US Q2 GDP also disappointed, weighed down by a sizeable drag from net trade that masked underlying strength in business investment and consumer spending. Annualised growth slowed to 1.5%, below the 2.1% consensus forecast. Consumer spending rebounded to a 3.2% annualised pace after a subdued first quarter, while business investment surged 15.2%, continuing to be supported by AI-related capital expenditure. The downside surprise instead reflected a widening trade deficit and inventory drawdowns, which subtracted almost 1.7 percentage points from headline growth.
Risk appetite returns with a vengeance Alongside softer US economic data and suspected intervention, the Aussie and Kiwi ripped higher as risk appetite surged. Strong earnings updates from Microsoft and Amazon fuelled the rally, with Microsoft adding more market value in a single session than any listed company on record.
Given their sensitivity to global risk sentiment, the improvement in sentiment helped drive gains not only against the US dollar, but across most major crosses, with the yen the one exception.
All eyes turn to Tokyo When it comes to what may influence the Aussie and Kiwi on Friday, the events of the past 24 hours suggest risk appetite, the Bank of Japan policy decision and the threat of further intervention from Asian FX authorities will matter far more than economic data. That was reinforced by the total lack of reaction to an upside surprise in Tokyo's July inflation report released early Friday.
Intervention raises the stakes for the BOJ I previewed the Bank of Japan meeting in detail earlier this week, and much of that analysis still holds true. However, the intervention episode over the past 24 hours has increased the risk, at least marginally, of the Bank of Japan moving pre-emptively to raise rates today rather than later in the year, with a full hike already priced into the overnight index swap curve by year-end.
US Treasury Secretary Scott Bessent has made it clear he wants the Bank of Japan to continue normalising policy. If Japanese authorities are already working alongside their South Korean and US counterparts to strengthen the yen through intervention, it raises the question of whether the Bank of Japan may choose to oblige by delivering a surprise rate hike today.
While such a shock outcome would point to a sharply lower USD/JPY and potentially broader US dollar weakness, it would not necessarily be an outright positive for the Australian and New Zealand dollars. They may initially pop against the greenback, but given their sensitivity to shifts in risk appetite, would likely underperform lower-beta currencies if a surprise Bank of Japan hike sparked a broader risk-off episode.
As for when the Bank of Japan decision is likely to drop, it remains a frustration for traders worldwide that there is still no set time for the announcement. Generally, it tends to arrive around 12:30pm Tokyo time, although it can come earlier or later depending on how long the meeting runs. However, the general rule of thumb is that the longer it takes for the decision to drop, the greater the perceived risk that there may be some form of policy shock on the way. So expect markets to become extra twitchy if we extend well beyond 12:30pm Tokyo time.
AUD/USD breakout puts higher levels in play
Source: TradingView
AUD/USD had been coiling in what resembles an ascending triangle before a false downside break followed the softer-than-expected Australian June quarter underlying inflation report on July 29. However, that move has now been completely reversed, with the pair not only breaking back into the triangle structure, but also reclaiming the 50-day moving average and clearing resistance at 0.7020, the top of the structure.
With the price now holding above 0.7020, it provides a level to build long setups around, looking for an extension of the bullish move. Longs could be considered above that level, with a stop below, initially targeting the 100-day moving average at 0.7053 before resistance at 0.7080. A break above the latter would open the door for a potential run towards 0.7200.
The oscillators marginally favour long setups over shorts. RSI(14) has pushed above the neutral 50 level and continues to edge higher, while MACD has flipped into positive territory after staging a bullish crossover earlier this month. It's not a definitively bullish signal, but it does suggest upside momentum is building.
Should AUD/USD slip back below 0.7020 and hold there, it would instead point to a pullback towards the lower boundary of the triangle structure, which comes in around 0.6975 today.
Kiwi joins the breakout party
Source: TradingView
NZD/USD offers a similar technical picture to AUD/USD, breaking higher after grinding higher within an uptrend over recent weeks. The latest surge has seen it break above the confluence of the 50, 100 and 200-day moving averages, along with resistance at 0.5825 and, importantly, 0.5860, a level that has repeatedly acted as both support and resistance over the past couple of months.
The break above 0.5860, taking the pair to its highest level since early June, suggests scope for a further extension of the bullish move. For those looking to play from the long side, longs could be considered while the pair holds above 0.5860, with a stop below, initially targeting 0.5920, another level that has repeatedly acted as support and resistance this year. A break above that would open the door for a retest of the double top at 0.5992 set in May and early June.
The oscillators favour long setups over shorts. RSI(14) has climbed to 64, with the bullish signal reinforced by MACD, which has crossed above the signal line, continues to diverge and remains in positive territory. That suggests upside momentum is building, favouring long setups.
Should NZD/USD slip back below 0.5860 and hold there, it would instead point to a pullback towards the moving average confluence zone and the uptrend, which comes in around 0.5775 today.
The AUD/USD pair turns lower following a modest Asian session uptick to the 0.6965 region on Thursday amid the emergence of some US Dollar (USD) dip-buying. Spot prices, however, hold above an over two-week low, touched on Wednesday, and currently trade around mid-0.6900s, down less than 0.10% for the day.
The growing acceptance that the US Federal Reserve (Fed) will hike interest rates in 2026 amid inflation risks stemming from volatile oil prices, along with escalating US-Iran tensions, helps revive demand for the safe-haven Greenback. Furthermore, soft Australian consumer inflation figures on Wednesday led to some unwinding of near-term Reserve Bank of Australia (RBA) rate hike bets, which undermines the Australian Dollar (AUD) and contributes to capping the AUD/USD pair.
From a technical perspective, the recent repeated failures near the 0.7020 horizontal resistance and the overnight close below the 100-period Exponential Moving Average (EMA) on the 4-hour chart favor bearish traders. Furthermore, the Relative Strength Index (RSI) drifts below the neutral 50 line and Moving Average Convergence Divergence (MACD) stays marginally below zero. Momentum indicators together hint at subdued bullish momentum and a corrective tone after recent losses.
However, it will still be prudent to wait for some follow-through weakness below the overnight swing low, around the 0.6925 region, and a technically significant 200-day Simple Moving Average (SMA) near 0.6900 before positioning for further losses. The AUD/USD pair might then aim to challenge the June monthly swing low, around the 0.6865 zone, and extend the downfall further to the 0.6835 area, or the year-to-date low touched in March, and the 0.6800 round-figure mark.
On the topside, initial resistance is defined by the 100-period EMA at 0.6974. A sustained move above this barrier would be needed to ease immediate downside pressure and open the way for a more constructive recovery. Until then, the AUD/USD pair remains vulnerable to further slippage, with traders likely to fade upticks while spot prices remain capped below the said EMA.
AUD/USD 4-hour chart
Australian Dollar Price This week The table below shows the percentage change of Australian Dollar (AUD) against listed major currencies this week. Australian Dollar was the strongest against the US Dollar.
USDEURGBPJPYCADAUDNZDCHFUSD-0.50%-0.10%-0.08%-0.28%0.67%-0.10%-0.11%EUR0.50%0.38%0.43%0.21%1.18%0.40%0.39%GBP0.10%-0.38%-0.09%-0.17%0.76%0.02%0.00%JPY0.08%-0.43%0.09%-0.21%0.76%-0.02%-0.12%CAD0.28%-0.21%0.17%0.21%0.94%0.19%0.17%AUD-0.67%-1.18%-0.76%-0.76%-0.94%-0.77%-0.80%NZD0.10%-0.40%-0.02%0.02%-0.19%0.77%-0.01%CHF0.11%-0.39%-0.00%0.12%-0.17%0.80%0.01% The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Australian Dollar from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent AUD (base)/USD (quote).
(The technical analysis of this story was written with the help of an AI tool. Know more.)
AUD/USD klesá už třetí den v řadě po slabších australských inflačních datech a je asi 0,25 % níže za den. Pár se propadl na více než dvoutýdenní minimum.
The AUD/USD pair attracts sellers for the third straight day on Wednesday and dives to an over two-week trough following the release of softer Australian consumer inflation figures. Spot prices, however, rebound a few pips from the Asian session low and currently trade just above mid-0.6900s, still down around 0.25% for the day.
The US Dollar (USD) remains on the back foot below the monthly high, touched on Tuesday, as bulls opt to move to the sidelines ahead of the crucial FOMC policy decision, due later today. This, in turn, offers some support to the AUD/USD pair. However, a fresh escalation of tensions between the US and Iran revives inflation fears. This, in turn, bolstered bets for at least one rate hike by the US Federal Reserve (Fed) in 2026, which favors USD bulls and backs the case for further depreciation for the currency pair.
From a technical perspective, the recent repeated failures to find acceptance above the 0.7000 psychological mark and the latest leg down below the 0.6965-0.6960 confluence support could be seen as a key trigger for AUD/USD bears. The said area marked the lower boundary of a two-week-old range and the 38.2% Fibonacci retracement level of the recent move up from a multi-month low, touched in June. Meanwhile, the Relative Strength Index (RSI) hovers near 38, hinting at lingering downside pressure.
Moreover, the slightly negative Moving Average Convergence Divergence (MACD) suggests that bearish momentum is present but not accelerating decisively. Moreover, an intraday resilience below the 50% retracement level makes it prudent to wait for some follow-through selling below the daily swing low, around the 0.6935 region, before placing fresh bearish bets on the AUD/USD pair. If selling extends, spot prices could fall to the 61.8% level at 0.6926 as traders await the FOMC decision.
Meanwhile, a deeper slide would expose the 78.6% retracement at 0.6898 and the structural floor at 0.6863, levels that could attract dip-buying interest should the current bearish bias persist.
(The technical analysis of this story was written with the help of an AI tool. Know more.)
AUD/USD 4-hour chart
Australian Dollar Price This week The table below shows the percentage change of Australian Dollar (AUD) against listed major currencies this week. Australian Dollar was the strongest against the British Pound.
USDEURGBPJPYCADAUDNZDCHFUSD-0.05%0.25%-0.15%0.02%0.64%0.22%0.15%EUR0.05%0.28%-0.09%0.06%0.69%0.26%0.19%GBP-0.25%-0.28%-0.48%-0.21%0.42%-0.01%-0.08%JPY0.15%0.09%0.48%0.14%0.76%0.35%0.19%CAD-0.02%-0.06%0.21%-0.14%0.59%0.21%0.13%AUD-0.64%-0.69%-0.42%-0.76%-0.59%-0.42%-0.49%NZD-0.22%-0.26%0.01%-0.35%-0.21%0.42%-0.07%CHF-0.15%-0.19%0.08%-0.19%-0.13%0.49%0.07% The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Australian Dollar from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent AUD (base)/USD (quote).
Slabší australská CPI posílila sázky na to, že RBA už letos sazby nezvýší, a AUD/USD spadl pod rostoucí kanál. Další klíčová support zóna je kolem 0,6750.
TL;DR: Australia’s soft CPI print has pushed all four major banks into agreement that the RBA’s tightening cycle is over for now, driving AUD/USD below its rising channel with 0.6750 emerging as the next major support cluster.
Why This CPI Print Changes the Story Australia’s softer inflation report is more than just another downside CPI surprise — it marks the point where markets concluded the RBA’s tightening cycle has effectively run its course. That shift in policy expectations triggered a sharp decline in AUD/USD, but its implications extend well beyond Wednesday’s trading session. With expectations for further RBA tightening fading rapidly, the Australian dollar is losing one of its few remaining domestic pillars of support.
What the Data Actually Showed The inflation data itself offered little justification for another near-term rate increase. Headline CPI slowed from 4.0% to 3.8% y/y in June, while trimmed mean inflation was unchanged at 3.6%. Quarterly figures echoed the same trend, with headline inflation easing from 4.1% to 3.8% and trimmed mean inflation rising only modestly from 3.5% to 3.6%.
The most important detail, however, was how those figures compared with the RBA’s own expectations. Both the monthly and quarterly trimmed mean measures came in below the central bank’s May forecast of 3.8%. That outcome effectively validated Governor Michele Bullock’s remarks on Tuesday that underlying inflation had evolved broadly as expected since May — while also hinting the disinflation process may be progressing slightly faster than policymakers themselves anticipated.
Westpac’s Reversal Seals a Rare Bank Consensus The biggest surprise came from Westpac. Until Wednesday, it had been the only one of Australia’s Big Four banks still forecasting another rate hike in August. Following the CPI release, Westpac abandoned that call, now expecting the RBA to remain on hold for the rest of 2026 — leaving open only a conditional risk of a November hike should inflation reaccelerate sharply during the third quarter.
That revision carries significance beyond a single economist’s forecast. For the first time this tightening cycle, all four major Australian banks are united in expecting the RBA to leave policy unchanged through year-end based on current information. That consensus reinforces the perception that Australia’s monetary tightening phase has probably ended — unless a fresh inflation shock, such as another sustained surge in oil prices, materializes.
Where the Risk Shifts Now: The Fed and Asian Equities Attention therefore shifts away from Australia and toward global developments. Domestically, the policy story is largely settled for now. Externally, however, AUD/USD still faces several potentially bearish catalysts.
The first is the Federal Reserve, with the FOMC rate decision scheduled for today. Cleveland Fed President Beth Hammack and Dallas Fed President Lorie Logan are widely expected to vote in favor of another rate increase. If additional FOMC members also dissent, markets would likely interpret the outcome as a more hawkish signal than currently anticipated — supporting higher Treasury yields and extending the Dollar’s recent strength. The second is regional risk sentiment. Asian equity markets remain fragile despite Wednesday’s brief rebound. Renewed selling in technology shares has already pushed the KOSPI roughly 17% lower this week, while pressure continues to build across the broader AI sector. Given the Australian dollar’s strong correlation with Asian equity performance and global growth expectations, a deeper regional correction could reinforce downside momentum. ActionForex’s Technical View on AUD/USD The technical picture has already begun reflecting that deteriorating backdrop. AUD/USD broke decisively below its short-term rising channel after once again failing to overcome the falling 55 D EMA near 0.7004. The price action strongly suggests the rebound from 0.6864 ended at 0.7026 as merely a corrective recovery within the broader decline from 0.7277.
As long as rallies remain capped below the 55 4H EMA around 0.6981, the path of least resistance remains lower. A retest of 0.6864 should be seen next, with a sustained break opening the way toward the 61.8% projection of 0.7277 to 0.6864 from 0.7026, at 0.6771. That level sits just above a major medium-term Fibonacci support — the 38.2% retracement of 0.5913 to 0.7277, at 0.6756 — creating a critical support cluster around 0.6750.
Whether buyers are prepared to defend that area should decide whether the broader uptrend from 0.5913 remains intact or gives way to a much deeper medium-term decline.
Key Takeaways Australia’s Q2 trimmed mean CPI came in below the RBA’s own 3.8% May forecast, validating Bullock’s “evolving as expected” framing. Westpac abandoned its lone August hike call, leaving all four major Australian banks aligned on an RBA hold through year-end. Today’s FOMC decision and continued Asian equity weakness (KOSPI down ~17% this week) are now the dominant risks for AUD/USD, not domestic policy. AUD/USD broke its short-term rising channel after failing at the 55 D EMA (0.7004), with the 0.6864–0.7026 rebound now viewed as corrective. 0.6750 is the key support cluster to watch — a break opens a deeper medium-term decline; holding it keeps the broader uptrend from 0.5913 intact.
ActionForex
ActionForex.com was set up back in 2004 with the aim to provide insightful analysis to forex traders, serving the trading community for two decades. We started providing only a daily and a mid-day report, now known as Action Insights. Gradually, we added a lot more in-house contents to the site. Technical Outlook section was expanded to cover more pairs. In addition to that, Top Movers, Heat Map, Pivot Point Charts and Pivot Meters, Action Bias and Volatility Charts, are tools used by traders from all over the world.
The AUD/USD pair catches fresh bids during the Asian session on Thursday following the release of the upbeat Australian jobs report, which lifted bets for another interest rate hike by the Reserve Bank of Australia (RBA). Furthermore, a modest US Dollar (USD) weakness lifts spot prices to the 0.7020 region in the last hour, back closer to an over one-month high set on Tuesday.
Meanwhile, escalating US-Iran tensions and rising supply disruption concerns lift crude oil prices to a fresh high since June 11, fueling inflationary concerns and bolstering hawkish US Federal Reserve (Fed) expectations. This could help limit deeper losses for the safe-haven Greenback and hold back traders from placing aggressive bullish bets on the risk-sensitive AUD/USD pair.
From a technical perspective, spot prices retain a modest bullish near-term bias above the 38.2% Fibonacci retracement level of the decline from 0.7200 (late May high) and the 100-period Exponential Moving Average (EMA) on the 41-hour chart. Adding to this, the Relative Strength Index (RSI) at 59.45 validates the constructive outlook without signaling overbought conditions.
However, the Moving Average Convergence Divergence (MACD) histogram flattens just below the zero line, hinting that upside momentum is positive but not aggressive. Hence, any subsequent move up is likely to confront initial resistance at the 50.0% level at 0.7033. Furthermore, the 61.8% Fibo. retracement at 0.7072 should act as the next hurdle in the current recovery sequence.
Further up, the 78.6% level at 0.7129 and the cycle high region at 0.7201 mark stronger barriers. On the downside, immediate support is seen at the 38.2% retracement at 0.6993, ahead of the 100-period EMA at 0.6976. A deeper pullback would expose the 23.6% retracement at 0.6944, with the broader bullish structure only threatened on a slide toward the anchor low near 0.6865.
(The technical analysis of this story was written with the help of an AI tool. Know more.)
AUD/USD 4-hour chart
Australian Dollar Price Today The table below shows the percentage change of Australian Dollar (AUD) against listed major currencies today. Australian Dollar was the strongest against the New Zealand Dollar.
USDEURGBPJPYCADAUDNZDCHFUSD-0.14%-0.06%-0.03%-0.12%-0.21%0.00%-0.10%EUR0.14%0.09%0.13%0.01%-0.07%0.16%0.04%GBP0.06%-0.09%0.04%-0.08%-0.17%0.04%-0.06%JPY0.03%-0.13%-0.04%-0.10%-0.19%0.02%-0.09%CAD0.12%-0.01%0.08%0.10%-0.10%0.14%0.00%AUD0.21%0.07%0.17%0.19%0.10%0.24%0.14%NZD-0.01%-0.16%-0.04%-0.02%-0.14%-0.24%-0.14%CHF0.10%-0.04%0.06%0.09%-0.01%-0.14%0.14% The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Australian Dollar from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent AUD (base)/USD (quote).
Commodity-linked currencies strengthened after US inflation data came in weaker than expected. The Consumer Price Index (CPI) slowed to 3.5% year-on-year in June, below the 3.8% forecast, while core inflation eased to 2.6% versus expectations of 2.8%. On a monthly basis, headline CPI unexpectedly fell by 0.4%, while core CPI was unchanged. The moderation in inflationary pressure increased expectations that the Federal Reserve may adopt a more accommodative policy stance, putting pressure on the US dollar and supporting both the Australian and Canadian dollars against the greenback.
However, despite the weaker US dollar, the next move in USD/CAD will largely depend on the Bank of Canada’s policy decision. Later today, the central bank will announce its interest rate decision, publish its updated Monetary Policy Report, and hold a press conference with the Governor. If policymakers maintain a cautiously hawkish tone on inflation, the Canadian dollar could receive additional support. Conversely, a more dovish message may limit CAD gains despite the broader weakness in the US dollar.
Market participants will also focus on the release of the US Producer Price Index (PPI), which will provide further insight into inflation trends following the softer CPI report. In addition, US crude oil inventory data could influence USD/CAD, as oil prices traditionally have a significant impact on the Canadian dollar.
AUD/USD The AUD/USD pair continues to develop the bullish engulfing reversal pattern. Yesterday, buyers managed to test the key resistance level around 0.7000. If the pair secures a sustained break above this level, the rally could extend towards the 0.7080–0.7130 area. The bullish scenario would be invalidated by a move below 0.6900.
Key events for AUD/USD:
Today at 14:00 (GMT+3): US MBA Mortgage Market Index Today at 15:30 (GMT+3): US Producer Price Index (PPI) Today at 15:45 (GMT+3): Speech by FOMC member John Williams
USD/CAD Following confirmation of the bearish tower top reversal pattern, selling pressure on USD/CAD intensified, reinforced by the weaker-than-expected US inflation data. As a result, the pair declined below 1.4100. Technical analysis suggests there is scope for a further move lower towards the 1.3960–1.4020 area. A decisive break back above 1.4120 could revive the bullish outlook.
Key events for USD/CAD:
Today at 16:45 (GMT+3): Bank of Canada interest rate decision Today at 17:30 (GMT+3): US Crude Oil Inventories Today at 17:30 (GMT+3): Bank of Canada press conference
Overall, the weaker US inflation report strengthened expectations of a more accommodative Federal Reserve, weighing on the US dollar and supporting commodity-linked currencies. However, the next moves in AUD/USD and USD/CAD will depend on upcoming economic data and the Bank of Canada’s policy guidance.
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AUD/USD advances toward the 0.6960 area on Friday, supported by a softer US Dollar (USD) and renewed strength in the Chinese Yuan (CNY). The pair continues to recover on the four-hour chart, although escalating tensions between the United States (US) and Iran are limiting broader risk appetite.
US President Donald Trump said on Truth Social that Iran had requested further negotiations and that Washington had agreed to continue talks. However, Trump warned that the ceasefire was “over,” raising concerns that hostilities could intensify despite diplomatic channels remaining open.
Meanwhile, the Chinese Yuan strengthened to a one-week high against the US Dollar, offering additional support to the Australian Dollar given Australia’s close trade ties with China. The move followed a stronger fixing from the People’s Bank of China (PBOC), which set the USD/CNY midpoint at 6.7989, below the key 6.8000 level.
The latest price action also points to improving momentum in AUD/USD. The pair is trading above its short and medium-term moving averages, while the Relative Strength Index (RSI) remains in positive territory without signaling overbought conditions.
Looking ahead, investors will closely monitor next week’s US Consumer Price Index (CPI) report. A stronger-than-expected inflation reading could reinforce expectations that the Federal Reserve (Fed) will maintain a restrictive policy stance, supporting the USD and limiting further gains in AUD/USD. Softer inflation, by contrast, could weigh on the Greenback and help the pair extend its advance.
In Australia, attention will turn to Consumer Inflation Expectations. The report will offer fresh insight into how households expect prices to develop over the coming year and could influence expectations surrounding the Reserve Bank of Australia’s policy outlook.
Short-term technical analysis:On the 4-hour chart, AUD/USD trades at 0.6956, retaining a mildly bullish tone as it holds above both the 20-period Simple Moving Average (SMA) at 0.6938 and the 100-period SMA at 0.6934. The clustering of short and medium-term SMAs beneath price suggests a supportive backdrop, while the RSI around 58 indicates constructive but not overextended bullish momentum, leaving room for further upside provided immediate overhead barriers are challenged.
On the topside, initial resistance is aligned at 0.6958, ahead of a tighter cap at 0.6961, with a more notable barrier emerging at 0.6970, where buying pressure could start to fade if momentum cools. On the downside, first support is seen at 0.6949, followed by the 20-period SMA at 0.6938 and the 100-period SMA at 0.6934, where a break back below these levels would undermine the current constructive bias and hint at a deeper correction.
(The technical analysis of this story was written with the help of an AI tool. Know more.)
The AUD/USD retreats slightly from the 0.6960 area, or a two-week high, touched during the Asian session on Tuesday, and, for now, seems to have snapped a three-day winning streak. The intraday downtick, however, lacks bearish conviction, warranting caution before confirming that a one-week-old recovery move from a three-month low has run out of steam.
From a technical perspective, the AUD/USD pair, so far, has been struggling to make it through the 38.2% Fibonacci retracement level of the November 2025-May 2026 rally. Furthermore, mixed momentum oscillators make it prudent to wait for a sustained move beyond the said barrier before positioning for an extension of the recent bounce from the very important 200-day Simple Moving Average (SMA) support near 0.6870.
In fact, the Moving Average Convergence Divergence (MACD) has turned slightly positive, hinting at a slight improvement in the upside momentum. However, the Relative Strength Index (RSI) near 42 suggests only modest directional pressure, consistent with a consolidative bias around current levels, warranting some caution for aggressive bullish traders as renewed tensions in the Strait of Hormuz support the US Dollar.
Meanwhile, initial support emerges at the 50% retracement at 0.6853, ahead of a deeper structural floor at the 61.8% Fibo. near 0.6752, with 0.6608 and 0.6425 marking subsequent retracement and cycle-low supports if selling extends. On the topside, a break above the 38.2% Fibo. at 0.6954 would open the way toward the 23.6% retracement barrier at 0.7079, while the cycle high around 0.7282 stands as a more distant objective should bullish momentum gain traction.
(The technical analysis of this story was written with the help of an AI tool. Know more.)
AUD/USD daily chart
Australian Dollar Price Last 7 Days The table below shows the percentage change of Australian Dollar (AUD) against listed major currencies last 7 days. Australian Dollar was the strongest against the Canadian Dollar.
USDEURGBPJPYCADAUDNZDCHFUSD-0.13%-0.99%-0.10%0.04%-0.83%-0.85%-0.25%EUR0.13%-0.88%0.04%0.15%-0.71%-0.66%-0.12%GBP0.99%0.88%0.93%1.01%0.15%0.21%0.75%JPY0.10%-0.04%-0.93%0.17%-0.69%-0.64%-0.18%CAD-0.04%-0.15%-1.01%-0.17%-0.87%-0.80%-0.28%AUD0.83%0.71%-0.15%0.69%0.87%-0.01%0.59%NZD0.85%0.66%-0.21%0.64%0.80%0.01%0.51%CHF0.25%0.12%-0.75%0.18%0.28%-0.59%-0.51% The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Australian Dollar from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent AUD (base)/USD (quote).
