AUDUSD, Timeframe: weekly, Tools: SMA 100AUDUSD, Timeframe: weekly, Tools: SMA 100

Technical Analysis of AUD/USD

Anyone following the AUD/USD chart will notice the significant importance of the 0.6860 level. This importance can be summarized as follows:

  1. It represents a support zone formed by a number of previous lows.
  2. The level has previously triggered three separate rebounds.
  3. Each of these three previous rebounds was relatively strong.
  4. Finally, this support level has been in place for approximately one year, meaning that AUD/USD has held above it for nearly a year.

Therefore, 0.6860 is a key level to watch when assessing AUD/USD price action, whether the pair produces a fourth rebound from this area or breaks below and gives up this support.

Fundamental Analysis of AUD/USD

This week, AUD/USD is recording its fifth consecutive weekly decline, marking its longest losing streak since February 2024. Meanwhile, the US dollar continues to strengthen against a basket of major currencies amid expectations of a second interest-rate hike before the end of the current year, following last month's 25-basis-point rate increase. AUD/USD is one of the most actively traded major currency pairs among market participants.

The pair's performance is closely linked to movements in a range of commodities, most notably gold. As a result, the decline in gold prices has added to the pressure on the Australian dollar. AUD/USD is also often traded as an indicator of risk appetite in financial markets: when risk appetite increases, the pair tends to rise, and vice versa. As a result, AUD/USD remains an important instrument for both currency traders and investors.