In line with most of the major currencies, the Aussie dollar has gained ground against the greenback over the last week or so, adding just under 3% from its low just under 62 cents at the beginning of the month. However, most traders have noted that it has fared much less well on the crosses than against the greenback and feel that the Aussie could be in for tougher times ahead, especially if we see a change of direction for the US dollar in the short term.
Concerns over a potential international trade war and its impact on global growth have weighed heavily on the Aussie over recent weeks, which has kept it trading towards the lower end of its recent monthly ranges whereas some of the other majors have had major breaks to the topside. However, the RBA remains hawkish relative to other major central banks and that could have a bearing for longer-term trades.
The AUDUSD has traded in a relatively tight range over the last few days with options expiries around 0.6300, helping to keep the pair circulating that level. However, it is still within striking distance of trendline resistance and recent highs and a break higher could see it challenge the annual high at 0.6408. Conversely, a change in direction for the greenback or more threats to global growth could see pressure on the Aussie and see it drop back into recent ranges with short-term support now coming in on the trendline just above 0.6200.
Resistance 2: 0.6408 – 2025 High
Resistance 1: 0.6352 – Trendline Resistance
Support 1: 0.6205 – Trendline Support
Support 2: 0.6185 – March Low
