Over the past 24 to 48 hours, the AUD/USD currency pair exhibited a steady upward trend, closing yesterday at 0.70809 compared to the previous day’s 0.70592. This movement was driven by multiple market factors. The US Federal Reserve’s cautious stance combined with yen intervention and easing geopolitical tensions in the Middle East weakened the US dollar, providing upward momentum for the Australian dollar.

Recent market news highlighted Australia’s Q4 GDP growth of 0.8%, surpassing the expected 0.6%. This strong economic data bolstered investor confidence, helping AUD/USD hold above the critical 0.70 psychological level. Although global tensions remain a concern for some investors, overall demand for the Australian dollar remains supported, reflecting a shift toward risk assets and commodity currencies amid reduced risk aversion.

For the average investor, this means the recent appreciation of the Aussie is not accidental but grounded in strong economic fundamentals and a weaker US dollar. The market volatility underscores the complex interaction between global economic and geopolitical factors, yet for those focused on fundamentals, the Australian dollar shows promising potential for appreciation.

Daily Chart

The daily chart shows AUDUSD rebounding strongly from recent lows near 0.6920, breaking above the primary descending trendline in recent days and reaffirming bullish momentum. The price remains above the 21-day EMA with contracting Bollinger Bands suggesting consolidated yet clear direction. The MACD displays a bullish crossover, indicating continued upward momentum. Overall, the longer-term trend has shifted from correction to bullish, with potential to retest resistance near 0.7150.

1H Chart

The hourly chart reveals price action ranging between 0.705 and 0.710 in the past 3-5 days, recently breaking a key resistance on the 4-hour chart. Short-term moving averages align bullishly, while Bollinger Bands expansion suggests increased volatility. The MACD and RSI readings support sustained upside momentum. A recent bullish engulfing candlestick signals an immediate buying interest, paving the way for a test of the 0.710 resistance and beyond.

Technical Trend:  Cautiously bullish trend

Key technical insights for AUDUSD include the bullish breakout of the descending trendline and MACD bullish crossover on the daily timeframe confirming upward momentum. On shorter timeframes, the recent bullish engulfing candle and Bollinger Bands expansion point to accelerating momentum. Critical resistance levels at 0.710 and 0.715 will be important to watch for confirming continuation. RSI remains below overbought levels, suggesting room for further gains and attractive trading opportunities in the near term.

Today’s economic calendar in GMT+1 includes notable events such as Japan’s Q2 GDP data early morning, with forecasts anticipating 2.1% annualized growth and 0.5% quarterly growth. Positive surprises could strengthen the JPY, indirectly pressuring AUDUSD. Chinese investment and industrial output data, as well as US manufacturing and CPI releases later in the day, are also market focal points. However, no direct high-impact Australian data is scheduled today. Traders should watch for volatility around these releases but no immediate direct catalysts for AUDUSD are identified.

Resistance & Support

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