The AUD/USD pair is trading near the lower boundary of its daily range, reflecting market indecision amid a weakening US Dollar (USD). The US Dollar Index (DXY) has slipped toward 100.60, under pressure from soft US inflation figures and growing expectations of a more dovish Federal Reserve (Fed) policy stance later this year.
Although US policymakers have recently downplayed speculation about a deliberate dollar-weakening strategy, ongoing trade discussions—particularly with South Korea—have renewed concerns that the US might tolerate stronger foreign currencies. This uncertainty has contributed to the broader softness in the Greenback, weighing on USD pairs such as AUD/USD.
Technical Outlook: Conflicting Signals Cloud Near-Term Direction
The technical setup for AUD/USD presents a mixed picture. The Relative Strength Index (RSI) remains neutral in the 50s, signaling a lack of directional bias. Meanwhile, the Moving Average Convergence Divergence (MACD) shows mild bearish momentum, suggesting fading upward pressure.
Short-term momentum indicators such as the Stochastic RSI Fast (3, 3, 14, 14) and the Stochastic %K (14, 3, 3) both hover in the 30s–40s range, reinforcing the neutral tone and indicating that the pair may be consolidating before its next significant move.
In terms of trend signals, the 20-day and 100-day Simple Moving Averages (SMAs) offer support to a short-term bullish narrative, while the 200-day SMA remains bearish, hinting at lingering downside risks in the longer term. The 10-day and 30-day Exponential Moving Averages (EMAs) also lean bullish in the near term, underscoring the split between short- and long-term technical views.
Key Levels to Watch
Support: 0.6420, 0.6415, 0.6413
Resistance: 0.6430, 0.6459
The pair remains confined within a narrow range. A decisive break above 0.6459 could signal the resumption of bullish momentum and pave the way toward higher levels. On the downside, a move below 0.6413 may expose the pair to further losses, confirming a short-term bearish shift.
For now, traders appear cautious, awaiting clearer signals from upcoming US economic data and Fed commentary before committing to directional plays.
Related Topics:
