As a result, the AUD/USD cross has broken through this confluence at 0.6300. Notably, this level coincides with the 100-day Simple Moving Average (SMA) and the 38.2% Fibonacci retracement level as well. The breakout comes as the pair gets support from a bit of US dollar weakness. This occurs just ahead of the highly anticipated release of US Producer Price Index (PPI) and comments by US Federal Reserve Chair Jerome Powell.
In the most recent month reported, Australia’s unemployment rate at 4.1% has not changed. This stability in the official employment data further boosts market sentiment on the strength of the Australian economy. In the 3 months ending in March 2025, Australia’s seasonally adjusted Wage Price Index soared by 3.4% y-o-y. This increase gives clear support to the Australian dollar.
The AUD/USD pair’s biggest hurdle now lies at the 0.6500 level. As such, this critical psychological level will be watched closely by traders. Market experts are convinced that as long as the pair stays this strong, it can stay above this level. If it does, the couple might likely skyrocket towards 0.6545 area, coinciding with the 61.8% Fibonacci retracement level.
The AUD/USD pair sees major support near the 0.6400 round level. Additionally, a horizontal area of 0.6360 – 0.6355 offers good support for the pair. Should the AUD/USD break below 0.6300 resistance, forecasters are cautioning it could swiftly backtrack to this key barrier. As always, keep an eye out for any new changes in the marketplace!
After a recent de-escalation in the US-China trade war that had spooked markets, investor sentiment has continued to improve. This turnaround has helped alleviate fears of an imminent US recession. It has helped to add further support to the Australian dollar, which is often seen as the quintessential risk-sensitive currency.
While all these factors seem constructive on the USD, USD bulls seem to be treading cautiously ahead of tomorrow’s PPI – Producer Price Index. The market is closely focused on this data, as it could impact Federal Reserve policy in the months ahead. Given the uncertainty leading up to this report, we could see increased volatility in this currency pair.
The AUD/USD pairing is revving up to a strong bullish trend. Analysts are looking for the 0.6600 round number to become a base for further advances, if the Australian dollar can hold firm above important layers of support.