AUDUSD is consolidating between 0.6460 and 0.6500, with immediate resistance at 0.6520–0.6550 and support at 0.6420–0.6440. A breakout above 0.6520 could extend gains toward 0.6700, while a drop under 0.6420 risks a slide toward 0.6380. Short-term direction remains range-bound, with US Fed cues as a key swing factor.
Fundamental Factors Affecting AUDUSD
- Policy Shift: The RBA cut rates to 3.60% on August 12, marking the third reduction this year. Governor Bullock signaled willingness to ease further if labor conditions deteriorate.
- Sentiment Lift: Consumer confidence climbed to 98.5 in August, the highest since early 2022, as households reacted positively to easing borrowing costs.
- Labor Market Caution: Despite optimism, analysts warn of risks from a weakening job market. A sharper downturn could force the RBA into a deeper easing cycle.
- Global Influence: Fed signals remain a decisive factor. A dovish Fed policy could reinforce AUD gains, while hawkish guidance would cap upside momentum.
1. RBA easing and consumer sentiment rebound
On August 12, the Reserve Bank of Australia cut its cash rate to 3.60%, the third reduction this year, citing easing inflation and rising unemployment. The central bank signaled readiness for further policy easing if required. This move buoyed consumer sentiment: a Westpac-Melbourne Institute survey showed a rise to 98.5 in August—the highest since early 2022, reflecting growing financial optimism.
2. Mixed macro context & labor market caution
Despite some relief from rate cuts, concerns persist over a softening labor market. Analysts warn the RBA may deepen its easing cycle if employment conditions deteriorate.
3. Technical action & Fed influence
Technically, AUDUSD consolidates within 0.6460–0.6500, with resistance nearing 0.6520–0.6550 and support around 0.6420–0.6440. Short-term dynamics remain sensitive to US signals; dovish Fed cues may further support the AUD.
Summary
The dive to 3.60% and a rise in sentiment give AUDUSD a modest boost. The pair remains range-bound between 0.6440 and 0.6520, with downside capped unless the labor market softens deeply. A break above 0.6520 could pave the way to 0.67, while a slip below 0.6420 risks a fall to 0.6380.
AUDUSD H4 Timeframe
.png)
On this AUDUSD H4 chart:
Price has been clearly bearish, forming lower highs and lower lows. Recently, it bounced from the 0.6440 zone and is now retracing upward. The chart shows a rising wedge (short-term correction) that has already broken down, confirming bearish continuation.
The price is climbing toward a heavy confluence zone between 0.6535 and 0.6565.
This area is packed with:
- Multiple horizontal resistance levels (0.6537, 0.6543, 0.6550, 0.6555, 0.6559).
- The underside of the broken ascending trendline.
- The descending resistance trendline from above.
The black arrow projection shows a rejection expected from this zone, aligning with the broader downtrend. If sellers defend it, the price could resume the bearish leg toward 0.6440, possibly breaking lower into 0.6400.
Direction: Bearish
Target- 0.64347
Invalidation- 0.65760
CONCLUSION
You can access more trade ideas and prompt market updates on the Telegram channel.
