Above 0.7000: AUD/USD Holds as Bulls Await Break Above 100-SMA

• 100-day SMA resistance limits AUD/USD’s modest Asian-session advance.
• With Fed rate-hike expectations and geopolitical risks supporting the USD, further gains in the pair remain constrained.
• Ahead of Wednesday’s FOMC decision, hawkish RBA expectations lend support to the Aussie.

AUD/USD remains above the psychological 0.7000 level. The pair has again stalled near its 100-day Simple Moving Average (SMA), surrendering some of Tuesday’s modest Asian-session gains that had brought it closer to the one-month high reached the previous day. Its resilience above 0.7000 calls for caution among bearish traders before key data releases and central bank events.

Wednesday brings Australia’s monthly consumer inflation release, followed by the closely watched FOMC policy announcement. With the US Federal Reserve (Fed) expected to leave interest rates on hold after its two-day meeting, attention will centre on the policy statement and Fed Chair Kevin Warsh’s remarks at the subsequent press conference. Thursday’s US releases, the Advance Q3 GDP report and the Personal Consumption Expenditures (PCE) Price Index, will offer further signals on the Fed’s policy trajectory. That outlook will shape the US Dollar’s (USD) direction and give AUD/USD fresh impetus.

For now, support for the dollar comes from geopolitical uncertainty and a growing conviction that the US central bank will lift borrowing costs in December, as elevated energy prices fuel inflation concerns. The USD Index (DXY), a measure of the Greenback against a basket of currencies, is advancing for a third consecutive day, restricting AUD/USD’s upside. Offsetting this pressure, hawkish interest rate expectations for the Reserve Bank of Australia (RBA) underpin the Aussie and contain its losses. A decisive break below the round 0.7000 level would therefore be needed before concluding that the recent rebound from a multi-month low has lost momentum.

Technically, the 100-day SMA continues to constrain spot prices, which are currently testing the 38.2% Fibonacci retracement at 0.7025. The broader outlook remains fragile, even with momentum indicators mildly positive. A Relative Strength Index (RSI) reading near 51 and a rising Moving Average Convergence Divergence (MACD) above zero suggest a tentative recovery, not a definitive bullish reversal, while AUD/USD trades below that technical barrier. A daily close above this resistance cluster would, however, clear a path towards the 50% retracement at 0.7065, followed by the 61.8% level at 0.7105. Further out, the 78.6% retracement at 0.7162 represents a firmer medium-term ceiling.

Initial downside support lies near 0.6976, the 23.6% Fibonacci retracement. Beyond that sits the structural low around 0.6895; a break below it would reassert the broader bearish trend and invalidate the current improvement in momentum.

(The technical analysis of this story was written with the help of an AI tool. Know more.)

AUD/USD: daily price chart