AUD/USD Technical Analysis: Key Levels and Insights for Traders

Navigating the AUD/USD: Unpacking Technical Levels and Fundamental Forces

Welcome to our deep dive into the fascinating world of Forex trading, specifically focusing on the Australian Dollar versus the US Dollar, the AUD/USD currency pair. For many traders, whether you’re just starting out or looking to refine your strategies, understanding the forces that move this pair is crucial. The AUD/USD has seen some interesting price action recently, largely influenced by shifts in central bank policies, evolving inflation pictures, and significant global trade dynamics. As your guide, we aim to break down these complex factors into understandable insights, helping you build a robust framework for analysis. We believe that gaining knowledge is the first step towards achieving your trading goals, and we are here to support you on that journey.

The AUD/USD is often referred to as a ‘risk-sensitive’ or ‘commodity’ currency pair. This means its value is frequently influenced by global market sentiment and the prices of commodities like iron ore and copper, which are major Australian exports. Recently, we’ve observed the Australian Dollar gaining some ground against a weakening US Dollar. This might seem straightforward on the surface, but beneath this movement lies a confluence of technical signals and fundamental catalysts that warrant close examination. What exactly is driving this pair, and where might it be headed next? Let’s explore the key levels and forces at play.

Technical analysis is a powerful tool that helps us read the story the market is telling through price charts. It involves studying historical price movements, patterns, and indicators to forecast potential future price action. For the AUD/USD, identifying key support and resistance levels is fundamental. Think of these levels as invisible barriers on a chart – support being a floor where buying interest tends to emerge, and resistance being a ceiling where selling pressure typically increases. These levels aren’t arbitrary; they often represent points where significant market psychology, like previous turning points or concentrations of orders, comes into play.

• Support represents areas where buying interest may cause a price increase.
• Resistance indicates price levels where selling interest may cause a price decrease.
• Key levels can inform traders about potential entry and exit strategies.

When we look at the current AUD/USD chart, several levels stand out as particularly important. These are not just lines on a graph; they are price points where we have seen meaningful reactions in the past and where we might expect future price movements to pause, reverse, or accelerate if broken. Mastering the identification and interpretation of these levels is a cornerstone of technical trading. It allows us to define potential entry and exit points, manage risk with stop-losses, and set profit targets. But how do we distinguish the truly critical levels from minor ones? It often comes down to observing where the price has reacted repeatedly or where large volumes of trading activity have occurred.

Beyond static horizontal lines, technical analysis also considers dynamic levels, such as moving averages and chart patterns, which can provide clues about trend direction and momentum. Combining different technical tools offers a more comprehensive view. For instance, a horizontal support level might be reinforced if it coincides with a key moving average or the lower boundary of a chart pattern. This synergy between different technical elements helps build conviction in our analysis. Let’s begin by pinpointing the most significant support zones that have recently been relevant or could become so if the price declines.

Decoding Support: Why 0.6087 and 0.6000 Matter

Understanding support levels is crucial for any trader looking to identify potential buying opportunities or areas where a downtrend might stall. For the AUD/USD, the year’s lowest point, residing around the 0.6087 zone, represents a critical support level. Why is the yearly low so important? Because it marks the furthest the price has fallen within a significant timeframe. A level that has held the price from declining further for an extended period indicates strong buying interest at that price point in the past. It’s a test of the market’s resolve – can the bears push the price lower, or will the bulls defend this floor?

If the price were to break convincingly below the 0.6087 support, it would signal a significant shift in momentum. Such a break would suggest that the selling pressure has overcome the historical buying interest at this low, potentially opening the door for further declines. Where might the price head next if 0.6087 gives way? The data suggests that the next significant target area could be the psychological 0.6000 region. Psychological levels, often round numbers, act as magnets or barriers in the market simply because so many traders place orders or make decisions based on them. The 0.6000 level, representing a major handle (a significant round number boundary), would likely attract fresh attention from traders should the price approach it.

The region between 0.6087 and 0.6000 could be considered a zone of potential volatility. A breach of 0.6087 could lead to a rapid move towards 0.6000 as stop-losses are triggered and new selling orders are placed. Conversely, if the price approaches 0.6087 and holds, showing signs of bullish rejection (like long wicks on candlesticks or bullish engulfing patterns), it would reinforce the significance of this support and could signal a potential bounce. Monitoring how the price behaves *at* these levels is just as important as identifying the levels themselves. It tells us which side, buyers or sellers, is currently gaining the upper hand.

Examining Resistance: Hurdles at 0.6330 and Beyond

Just as support levels represent potential floors, resistance levels indicate potential ceilings where upward price movements may encounter selling pressure. Identifying these levels helps traders spot potential selling opportunities or areas where an uptrend might pause or reverse. For the AUD/USD, the yearly peak at 0.6330 stands out as a primary hurdle. Reaching this level indicates that the recent bullish momentum is being tested. Can the buyers push the price to new highs for the year, or will sellers emerge to defend this previous peak?

Beyond the yearly high, other significant resistance levels come into play, particularly those derived from moving averages and historical price points. The 100-day Simple Moving Average (SMA) at 0.6451 is another key dynamic resistance level. Moving averages represent the average price over a specific period and are widely watched by institutional traders. They can act as significant dynamic support or resistance, especially longer-term averages like the 100-day SMA. A price trading below the 100-day SMA is often interpreted as a sign that the longer-term trend is bearish or consolidating.

Looking further out, a previous weekly high at 0.6549 presents an even stronger resistance challenge. Weekly highs or lows often carry more weight than daily levels because they encompass a broader period of market activity. Overcoming resistance levels indicates that buying pressure is strong enough to absorb the selling interest at those points, potentially paving the way for further gains. Shorter-term resistance points noted in recent price action include levels around 0.6322 and 0.6260. While perhaps less significant than the yearly peak or the 100-day SMA, these levels still represent areas where temporary pullbacks or consolidation might occur.

Just like support, how the price interacts with these resistance levels provides crucial information. Does it push through convincingly with high volume? Does it stall, form bearish reversal patterns, and pull back? Observing this price action at resistance helps confirm whether the level is likely to hold or break. A successful break above significant resistance can signal the potential for a new uptrend or a continuation of the current bullish move, targeting the next resistance level above.

Technical Indicators: Signals from RSI, ADX, and Moving Averages

Technical indicators are mathematical calculations based on a security’s price, volume, or open interest. They are designed to help traders gain further insight into price momentum, trend strength, volatility, and potential buy/sell signals. While no single indicator provides a perfect forecast, using a combination can offer a more nuanced perspective. For the AUD/USD, two commonly watched oscillators are the Relative Strength Index (RSI) and the Average Directional Index (ADX).

The RSI is a momentum oscillator that measures the speed and change of price movements. It oscillates between 0 and 100, typically considered overbought above 70 and oversold below 30. For the AUD/USD, the RSI (14-period) has recently been noted near 55. What does this tell us? An RSI around 50 suggests a lack of strong momentum in either direction, or that momentum might be weakening. While above 50 can lean slightly bullish, a reading near 55, especially after an upward move, could hint that the bullish momentum is weakening rather than accelerating. This doesn’t necessarily signal an imminent reversal, but it suggests the upward drive might be losing steam.

The ADX, typically used with a 14-period setting, measures the strength of a trend, not its direction. ADX values below 20 generally indicate a weak or non-trending market, while values above 25 suggest a strong trend is developing. The data indicates the AUD/USD’s ADX (14) is currently around 18. What’s the takeaway from this? An ADX reading around 18 strongly suggests a lack of a strong directional trend in the market right now. This aligns with the RSI reading near 55 and the idea that the pair might be consolidating or range-bound rather than embarking on a powerful new trend.

Moving averages, such as the Simple Moving Average (SMA) and Exponential Moving Average (EMA), are also vital technical tools. They smooth out price data to create a single flowing line, making it easier to identify the direction and strength of a trend. Shorter-term moving averages (like the 20 or 50-period) are more sensitive to recent price changes, while longer-term ones (like the 100 or 200-period) provide a broader view of the trend. Moving averages can act as dynamic support and resistance; price pulling back to a rising moving average and bouncing is a classic bullish sign, while price rising to a falling moving average and being rejected is a bearish sign. Recent price action has involved interaction with the EMA50, which has acted as minor support, contributing to bullish bounces.

Taken together, the signals from these indicators paint a picture of a market currently lacking strong conviction. While the price may be attempting upward moves, the indicators suggest these moves might be tentative rather than the start of a sustained rally. This context is essential when interpreting the price action around key support and resistance levels. It suggests that breakouts might be prone to failure unless momentum indicators begin to confirm the move.

Chart Patterns and Concepts: Beyond Lines and Levels

Beyond standard support and resistance lines and indicators, technical analysis incorporates the study of chart patterns and structural concepts. These elements can provide additional layers of insight into market behavior, often reflecting the collective psychology of traders. For the AUD/USD, concepts like channels, range trading, demand zones, order blocks, and liquidity are relevant, particularly for traders employing more advanced methodologies.

A descending channel is a bearish pattern formed by two parallel, downward-sloping trendlines that contain the price action. While price may trade within this channel, reaching its lower boundary can sometimes signal a potential temporary bounce, while reaching the upper boundary can signal a potential reversal back down. The break of a channel, either upwards or downwards, can signal the potential start of a new trend or a significant acceleration of the existing one.

Range trading is a strategy employed when a currency pair is oscillating between a defined support and resistance level without breaking decisively in either direction. The ADX reading around 18 suggests that the AUD/USD might be suitable for range trading strategies currently. In a range-bound market, traders look to buy near support and sell near resistance, capitalizing on the price’s tendency to revert to the mean within the defined boundaries. Identifying the boundaries of the current range is key to successfully applying this strategy.

More advanced concepts like demand zones and order blocks stem from the idea that large institutional orders leave footprints on the chart. A demand zone is an area where significant buying interest historically entered the market, often leading to sharp price increases. An order block is a specific candlestick or group of candlesticks that initiated a strong move, representing where institutional orders were likely placed. These areas are watched by some traders as potential points where price might revisit before continuing a move. The provided data references an “essential demand zone” and a “bearish order block,” suggesting these concepts are part of how some analysts view the AUD/USD structure.

Finally, the concept of liquidity is critical. Liquidity refers to the pool of pending buy and sell orders in the market, often concentrated above resistance levels (buy stops, buy limits) and below support levels (sell stops, sell limits). Price often moves towards areas of high liquidity because large players need that liquidity to fill their orders without significantly impacting the price. The idea of price “taking buy side liquidity” above a previous high before reversing is a common concept in advanced technical analysis, indicating that the upward move might have been fueled by triggering stop-losses rather than sustained buying pressure. Understanding where liquidity resides can offer clues about potential targets for price movement.

Central Bank Divergence: RBA Easing vs. Fed Uncertainty

Shifting from the technical picture to the fundamental drivers, central bank monetary policy is arguably the most significant influence on currency valuations over the medium to long term. Central banks control interest rates, which affect borrowing costs, investment returns, and ultimately, the flow of international capital. When a central bank raises interest rates, it typically makes the currency more attractive to foreign investors seeking higher yields, increasing demand for the currency. Conversely, cutting rates tends to make a currency less attractive, leading to decreased demand and potentially weakening the currency.

For the AUD/USD, the current divergence in the expected paths of the Reserve Bank of Australia (RBA) and the US Federal Reserve (Fed) is a major fundamental theme. Markets are currently anticipating that the RBA is poised to begin an easing cycle, meaning they are expected to start cutting interest rates. In fact, market pricing suggests there is a very high probability – around 90% – that the RBA will trim its official cash rate from 4.35% to 4.10% at its next policy meeting. What’s behind this expectation? Primarily, cooling inflation data in Australia, which we will discuss shortly, is giving the RBA room to potentially lower borrowing costs to support the economy.

On the other hand, the outlook for the US Federal Reserve is less clear-cut. While the Fed also faces a mandate to control inflation and support employment, recent data and commentary suggest they may be more cautious about cutting rates. If US inflation remains elevated or shows signs of picking up again, the Fed might feel compelled to maintain its restrictive stance for a longer period. This contrast – the RBA potentially cutting rates while the Fed holds or delays cuts – creates a significant differential in expected future interest rates between Australia and the United States. This differential can be a powerful driver for the AUD/USD pair; a widening gap in favor of the USD (Fed holds, RBA cuts) tends to be bearish for AUD/USD, while a narrowing gap (Fed cuts, RBA holds/hikes – though hikes seem unlikely now) tends to be bullish.

This divergence in monetary policy expectations is a key factor influencing capital flows. Investors might move funds out of Australia towards the US if US yields remain relatively higher, increasing demand for USD and decreasing demand for AUD. Conversely, if the RBA cuts but signals it’s a one-off move or if the Fed signals impending cuts, the dynamic could shift. Market participants are keenly watching both central banks for any hints about their future intentions, as these policy decisions can override many other factors impacting the currency pair.

Inflation’s Influence: AU vs. US Price Pressures

Inflation, the rate at which prices for goods and services are rising, is a primary concern for central banks and a major determinant of monetary policy. Central banks typically use interest rates as a tool to manage inflation; raising rates helps cool down an overheating economy and curb price pressures, while cutting rates stimulates economic activity, potentially leading to higher inflation (or preventing deflation).

In Australia, recent inflation data has been a key reason behind the market’s expectation of an RBA rate cut. The latest figures show that inflation is indeed cooling. The fourth-quarter Consumer Price Index (CPI) rose by 2.5% year-over-year, a noticeable decrease from the previous reading of 2.8%. Even more significantly, the RBA’s preferred measure, the trimmed mean CPI, which removes volatile items, slipped to a three-year low of 3.2%. These numbers suggest that the RBA’s previous rate hikes are having the desired effect on prices, potentially giving them the confidence to begin lowering rates to support economic growth.

However, there’s a wrinkle: the most recent reading of the Melbourne Institute’s Consumer Inflation Expectations actually showed an *increase*, rising to 4.6% from 4.0%. While official CPI data is what the RBA focuses on for its target (2-3%), consumer expectations about future inflation can also influence policy decisions and wage demands. If consumers *expect* inflation to rise, they might demand higher wages, which can create a wage-price spiral. This uptick in expectations, despite cooling actual CPI, might add a layer of caution for the RBA, potentially influencing their forward guidance even if they do cut rates next week.

Across the Pacific, inflation data in the United States also impacts the AUD/USD, albeit indirectly, through its influence on the US Dollar. Recent US inflation data, such as the Producer Price Index (PPI), which measures inflation at the wholesale level, is closely watched. If US inflation remains sticky or rises, it reinforces the case for the Federal Reserve to keep interest rates higher for longer. As discussed, this widening interest rate differential between the US and Australia could put pressure on the AUD/USD pair. Traders are constantly comparing the inflation outlook and the resulting policy expectations in both countries to gauge the potential direction of the currency pair.

The Shadow of Trade Wars: Tariffs, China, and AUD Risk

Global trade dynamics and geopolitical tensions can have a significant impact on currency markets, particularly on currencies like the Australian Dollar, which are considered ‘risk-sensitive’. When global tensions rise, leading to uncertainty about economic growth and stability, investors often seek refuge in ‘safe haven’ currencies like the US Dollar, Swiss Franc, or Japanese Yen. Conversely, riskier assets, including commodity-linked currencies like the AUD, tend to underperform in such environments.

Currently, fears of a potential global trade war are casting a shadow over market sentiment. These fears have been rekindled by recent actions from the United States regarding tariffs. Tariffs are taxes imposed on imported goods, and they can disrupt international supply chains, increase costs for businesses and consumers, and lead to retaliatory measures from affected countries. The possibility of US reciprocal tariffs targeting specific trading partners has been a source of market anxiety. While immediate tariffs on some countries like Canada and Mexico were reportedly delayed, the broader threat of protectionist trade policies remains.

More specifically impacting the AUD, the US recently imposed a 10% tariff on Chinese imports. Why does this matter so much for Australia? Because China is Australia’s biggest export destination, particularly for key commodities like iron ore and copper. Any measures that disrupt trade between the US and China, or that negatively impact the Chinese economy, can have a ripple effect on Australia. If tariffs lead to reduced demand for Chinese goods, it can subsequently decrease China’s demand for the raw materials Australia exports, putting pressure on commodity prices and, by extension, the Australian Dollar.

Beijing has reportedly hinted that it could challenge these US tariffs at the World Trade Organization (WTO), the global body overseeing trade agreements. While a WTO challenge is a formal process, the uncertainty and potential for escalation remain. The possibility of deepening trade tensions between major global economies, particularly involving Australia’s largest trading partner, still hangs over the market. For the AUD/USD trader, this means monitoring global trade headlines is just as important as watching technical levels or economic data. Increased trade friction is generally a negative factor for the Australian Dollar due to its strong link to global trade and commodity flows.

Commodities and Exports: Australia’s Economic Backbone

As a significant global producer and exporter of natural resources, the Australian economy is heavily reliant on the demand for and prices of commodities like iron ore, coal, and copper. This structural characteristic makes the Australian Dollar a ‘commodity currency’, meaning its value is often correlated with the performance of the commodity markets. When global demand for commodities is strong, particularly from major industrial consumers like China, commodity prices tend to rise. This boosts Australia’s export earnings, strengthens its terms of trade, and generally supports the value of the AUD.

Conversely, if global demand for commodities softens, or if disruptions like trade wars threaten export markets, commodity prices can fall. This negatively impacts Australia’s export revenue and can weigh on the AUD. Given China’s crucial role as Australia’s largest customer for raw materials, any factors affecting China’s economic growth or its trade relations directly influence the AUD’s prospects. The recent increase in fears surrounding a potential US-China trade war, triggered by US tariffs, directly translates into concerns about China’s future demand for Australian commodities.

Specifically, key Australian exports like iron ore and copper could face significant price pressure if global trade frictions persist and dampen Chinese industrial activity. A recent pullback in the prices of iron ore and copper was noted in the data as contributing to an “offered stance” in the spot AUD/USD market – meaning selling pressure on the pair. This illustrates the direct link; weaker commodity prices often lead to a weaker Australian Dollar.

Therefore, monitoring commodity price trends, especially those for iron ore and copper, and keeping abreast of economic developments in China, is an essential part of analyzing the AUD/USD. While technical levels provide a framework for trading price movements, the fundamental drivers from the commodity sector and Australia’s export relationship with China often provide the underlying impetus for those moves. Understanding this connection is vital for building a comprehensive view of the AUD/USD pair.

Navigating the Data Calendar: What’s Next?

For any currency trader, staying informed about upcoming economic data releases and central bank announcements is paramount. These events can trigger significant volatility and often provide the catalyst for price movements that challenge or confirm the technical picture. For the AUD/USD, key data releases from both Australia and the United States are on the radar.

On the Australian side, traders will be keeping a close eye on data related to inflation and consumer sentiment. Specifically, the release of the Melbourne Institute’s Consumer Inflation Expectations is noted as an upcoming event. As we discussed, while the official CPI is crucial for the RBA, consumer expectations about future inflation can still influence market sentiment and potentially policy discussions. Any surprises in this data, either significantly higher or lower than expected, could certainly stir further volatility in the Aussie Dollar, especially given the current focus on inflation trends.

Perhaps the most significant event on the near-term calendar for the AUD is the next Reserve Bank of Australia (RBA) decision. As mentioned, market expectations for a rate cut are very high. The outcome of this meeting, particularly the RBA’s decision on the cash rate and, importantly, their forward guidance regarding future policy, will be a major driver for the AUD/USD. Will they cut rates as expected? If so, what language do they use to describe the outlook? Do they signal that this is the start of an easing cycle, or do they suggest it could be a one-off adjustment? The market will scrutinize every word of the accompanying statement and any subsequent press conferences for clues about the RBA’s future intentions. An unexpected decision or hawkish/dovish surprise in the guidance could lead to sharp moves in the AUD/USD.

While US data also matters (like CPI, Non-Farm Payrolls, Fed commentary), the upcoming RBA decision is the more immediate high-impact event directly related to Australian monetary policy. Being aware of the dates and times of these releases, and understanding what the market is anticipating, is crucial for managing risk and potentially identifying trading opportunities around the news. Trading around major news events can be challenging due to potential volatility, but it’s undeniably a period where significant fundamental forces come into play.

When selecting a trading platform, the flexibility and technological advantages offered by Moneta Markets are notable. Supporting popular platforms like MT4, MT5, and Pro Trader, coupled with high-speed execution and competitive low spreads, it aims to provide a robust trading experience.

Blending Analysis: A Comprehensive Approach to AUD/USD

Successful trading often involves integrating different forms of market analysis. For the AUD/USD, this means combining the insights gained from technical analysis with an understanding of the fundamental forces at play. Technical analysis helps us identify key price levels, gauge momentum, and spot potential trading opportunities based on chart patterns. It provides a framework for *where* price might go or *where* it might react. Fundamental analysis, on the other hand, helps us understand the *why* behind the potential moves. It explains the underlying economic and political forces that influence supply and demand for a currency.

For example, a technical analyst might identify a strong resistance level at 0.6330. A fundamental analyst would then consider whether current economic conditions, central bank policies, or trade developments are likely to generate enough buying pressure (or limit selling pressure) to push the price through that resistance. If the fundamental picture is supportive – say, the RBA sounds more hawkish than expected, or commodity prices are surging – it might increase the probability of a bullish breakout above 0.6330. Conversely, if trade tensions escalate or US inflation data prompts the Fed to signal a more restrictive stance, it could increase the likelihood that 0.6330 will hold and the price will retreat.

• Combining technical and fundamental analysis can provide better insights.
• Identify support and resistance levels along with market drivers.
• A comprehensive approach increases your chances of successful trades.

Using this combined approach allows traders to build higher-conviction trading ideas. You might identify a potential buying opportunity at a support level (technical signal), but you’d gain more confidence in that trade if the fundamental backdrop also seems supportive (e.g., RBA cutting rates, improving global risk sentiment). Similarly, identifying a potential selling opportunity at a resistance level becomes more compelling if the fundamental picture is bearish (e.g., escalating trade war fears, weak commodity prices). This holistic perspective is particularly valuable for a pair like AUD/USD, which is so heavily influenced by a mix of technical and fundamental factors.

Consider the current environment: technical indicators suggest a lack of strong trend (ADX at 18), while RSI suggests weakening bullish momentum. This technical picture aligns somewhat with the fundamental uncertainty stemming from trade war fears and the differing central bank outlooks. The market seems to be digesting these conflicting fundamental signals, leading to potentially range-bound or choppy technical price action. Understanding both sides helps you avoid relying solely on one type of analysis, which can be misleading in complex market conditions.

If you’re seeking a regulated Forex broker that supports global trading, Moneta Markets holds multi-jurisdictional licenses including FSCA, ASIC, and FSA, and offers comprehensive support like segregated funds, free VPS, and 24/7 Chinese customer service, making it a preferred choice for many traders.

Conclusion: The Road Ahead for the Aussie

The AUD/USD currency pair finds itself navigating a complex landscape, influenced by significant technical levels and powerful fundamental forces. On the technical front, key support levels like 0.6087 and the psychological 0.6000 are crucial floors to watch, while resistance zones at 0.6330 (yearly peak), the 100-day SMA at 0.6451, and a previous weekly high at 0.6549 represent significant hurdles for the bulls. Technical indicators like RSI and ADX currently suggest a market that lacks strong directional momentum, hinting at potential consolidation or range-bound trading within these defined levels.

Simultaneously, the fundamental picture presents a mix of supportive and challenging factors. The expectation of the Reserve Bank of Australia commencing an easing cycle, potentially cutting rates as early as next week due to cooling domestic inflation (despite rising consumer expectations), offers potential headwinds for the AUD by reducing yield attractiveness. Conversely, the prospect of the US Federal Reserve maintaining a more restrictive policy if US inflation persists could support the USD relative to the AUD, widening the interest rate differential.

Adding another layer of complexity are the risks stemming from global trade tensions, particularly US tariffs targeting China. Given Australia’s heavy reliance on commodity exports to China, any escalation in trade disputes that dampens Chinese demand or commodity prices poses a significant risk to the Australian Dollar, reinforcing its risk-sensitive nature. Monitoring developments on this front, alongside the performance of key commodities like iron ore and copper, is essential for assessing the AUD’s fundamental outlook.

Moving forward, traders should continue to monitor how the AUD/USD price interacts with the identified technical support and resistance levels. Will 0.6087 hold on a pullback, or will 0.6330 be breached on an upward move? Simultaneously, paying close attention to upcoming economic data releases, especially the RBA decision and any further commentary on inflation from either Australia or the US, will be critical. The ongoing narrative around global trade tensions and their impact on commodity markets will also remain a significant factor influencing market sentiment for the AUD/USD.

Navigating this market requires a flexible approach, blending technical analysis to identify trading opportunities and manage risk with fundamental analysis to understand the major drivers and potential shifts in the market landscape. By staying informed and applying a comprehensive analytical framework, you can better position yourself to navigate the opportunities and challenges presented by the AUD/USD pair.

audusd technical analysisFAQ

Q：What impact do support and resistance levels have on AUD/USD trading?

A：Support and resistance levels can indicate potential price reversals or continuation, helping traders make informed decisions about entry and exit points.

Q：How do central bank policies influence the AUD/USD pair?

A：Central bank interest rate decisions affect demand for currencies; for AUD/USD, RBA rate cuts could weaken AUD, while Fed rate changes can strengthen USD.

Q：What role do commodities play in determining the AUD’s value?

A：As a ‘commodity currency’, the AUD’s value is often tied to the prices of key exports like iron ore and copper, with demand from China being particularly influential.