The recent RBA decision and the price action in the technical chart show potential buying pressure in the AUDUSD price. Meanwhile, the US Dollar Index (USDX) remains at the support line with corrective pressure, which might provide a chance for AUD bulls.
RBA Decisions On Australian Economy
The Reserve Bank of Australia's (RBA) latest decision to maintain the official cash rate (OCR) at 4.35% has bolstered confidence among investors in the Australian dollar. The Reserve Bank of Australia (RBA) highlighted that it would not be easing policy quickly and expected domestic inflation to continue to be high. Rather than June 2026 as previously predicted, both trimmed-mean and headline CPI inflation are now predicted to cross the low end of the 2-3% range by late 2026.
RBA Governor Michele Bullock highlighted that rate reductions are not imminent during her press conference, pointing out that it is premature to anticipate them. The Board has discussed raising interest rates.
In her most recent remarks, Governor Bullock reaffirmed the bank's willingness to hike interest rates to combat inflation, retaining a hawkish posture as long as core inflation stays high. She emphasized the bank's attention to inflation risks after the rate-stay decision. By late 2025, core inflation—which was 3.9% in the previous quarter—should drop to the intended range of 2% to 3%.
What's For China's Economy?
The deteriorating state of the Chinese economy might hamper the long-term recovery of the Australian dollar. China is still dealing with post-pandemic issues such as deflation and insufficient stimulus to support a robust recovery.
After the Politburo conference, where promises to support the economy were made but no concrete expansionary measures were presented, worries about demand from China also surfaced.
Data To Look At
In general, of the G10 central banks, the RBA will probably be the last to begin lowering interest rates. The AUD/USD could see support in the upcoming months due to the possibility of a medium-term alleviation by the Federal Reserve (Fed) in contrast to the RBA's anticipated prolonged restrictive standing.
After the RBA's hawkish statement, we may expect a surge in the AUDUSD price. Some additional clues might come from the upcoming US releases.
Investors will see the Building Permits and Prelim UoM Consumer Sentiment on Friday. Both reports could show a minor change in numbers.
AUDUSD Forecast Technical Analysis
The daily chart of AUDUSD shows extremely volatile market momentum, with the most recent showing a valid bullish reversal from the 0.6362 support line.
In the daily structure, the Hammer candlestick formation from the bottom suggests a massive buying pressure from the bottom. As a result, the price was aimed higher, and the daily candle was closed above the dynamic 200-day SMA. Meanwhile, the 50-day EMA is below the current price, suggesting a Golden Cross continuation.
Moreover, the volume looks supportive to bulls as the current high volume level of 0.6601 is just below the current price.
Based on the daily market structure, a bullish continuation is highly possible, where the main aim would be to test the 0.6800 resistance level.
On the other hand, a failure to hold the buying pressure above the 200 day SMA with an immediate rebound could lower the price towards the 0.6350 low.
