AUDUSD steadies above 0.6520 after the Reserve Bank of Australia surprised markets by holding rates at 3.85% (6‑3 vote), briefly sparking ~0.8% AUD strength. Yet with inflation cooling and domestic demand faltering, traders still price in possible August cuts, keeping the rally in check.
Meanwhile, the US dollar’s historic ~‑13% slide in 1H 2025—driven by policy drift and deepening deficits—continues to lift commodity‑linked peers like the Aussie. Though stretched short USD positioning warns of correction risk, net AUD shorts have quietly grown, suggesting potential for a squeeze higher.
Technically, the pair holds a 0.6480–0.6600 band: a decisive push above 0.6600 eyes 0.6680, while a slip below 0.6480 could see 0.6400 retested.
All eyes turn to August CPI, Fed rhetoric, and trade headlines to determine whether the Aussie can extend gains or resume its cautious drift.
AUDUSD – H4 Timeframe
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AUDUSD recently completed a bullish double break of structure. The highlighted demand zone enjoys confluence from the trendline support and the 88% Fibonacci retracement level. The initial target for the bullish reaction is the high near the 0.656 region.
Direction: Bullish
Target- 0.65712
Invalidation- 0.64832
CONCLUSION
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