FX.co ★ PipsHunter99 | AUD/USD

Technical and Fundamental Analysis of the AUD/USD Pair The Reserve Bank of Australia (RBA) raised its cash rate by 25 basis points, taking the target rate to 4.60%. The decision was broadly in line with market expectations, while policymakers continued to signal that inflation remains elevated. The central bank also left the door open to further tightening if necessary, indicating that interest rates could be raised again should inflationary pressures fail to ease as expected. Australian bond yields also remained elevated following the decision. The 10-year Australian government bond yield climbed around 0.2 basis points during the morning session, reaching 5.42%, its highest level since 2011. Despite the rate increase, the Australian dollar’s initial reaction was relatively subdued. The RBA’s statement emphasized that inflation remains a concern and that policymakers are prepared to adjust rates again if required, but traders appeared cautious about the broader economic implications. The tone of the subsequent press conference provided additional context for the Australian dollar. Governor Michele Bullock indicated that policymakers had considered leaving rates unchanged, reflecting concerns surrounding housing-market volatility and the potential impact of developments in the Middle East on the global economy. This more cautious communication limited the immediate boost that could normally follow a rate increase and kept AUD/USD below the 0.7000 level. Looking ahead, the Australian dollar’s outlook will also depend on broader US dollar trends and global liquidity conditions. Some analysts have maintained a December AUD/USD target around 0.7200, based partly on expectations that the US dollar could weaken toward the end of the year. Australia’s underlying fundamentals remain relatively supportive, and the latest RBA rate increase adds to the currency’s interest-rate advantage. However, a deteriorating global environment has increased the risk of additional short-term downside for AUD/USD, particularly while technical momentum remains bearish. AUD/USD was trading near 0.6986 after extending its H4 decline from the early-September peak around 0.7236. The pair has broken beneath the previous 0.7000–0.7003 demand area and is now testing fresh lows, keeping sellers firmly in control of the short-term structure. On the H4 chart, AUD/USD remains below both the 20 SMA and 50 SMA. Both moving averages are pointing lower and continue to act as dynamic resistance during recovery attempts. The 20 SMA is currently limiting short-term rebounds, while the higher 50 SMA reinforces the broader bearish trend and creates an additional barrier for buyers. The main H4 supply zone is located around 0.7020–0.7040. This area previously acted as support before the breakdown and has now turned into resistance. It also aligns with recent swing highs and the underside of the broken ascending trendline. Above this region, stronger supply is positioned around 0.7070–0.7075, where previous consolidation and the wave-matrix pivot create another significant resistance ceiling. On the H1 timeframe, the 20 SMA continues to provide immediate dynamic resistance during intraday recoveries, while the 50 SMA sits slightly higher and adds further overhead pressure. Initial demand is developing around 0.6965–0.6975, an area formed by recent equal lows and signs of accumulated trading volume. If selling pressure intensifies and this zone fails, the next notable demand area is located around 0.6940–0.6950. Initial support sits at 0.6965–0.6975, followed by the deeper 0.6940–0.6950 demand base. Resistance is concentrated first at 0.7020–0.7040 and then at the stronger 0.7070–0.7075 zone. A sustained H4 move back above the 20 SMA and the 0.7020 level would be needed to weaken the current corrective structure. Conversely, continued acceptance below 0.6965 would reinforce the bearish setup and expose the next demand region around 0.6940.