AUD/USD Rises from Multi-Month Lows

AUD/USD is trading near 0.6465 this Tuesday as the Australian Dollar comes under pressure amid heightened geopolitical tensions in the Asia-Pacific. The Aussie dipped briefly below 0.6450 earlier in the week after comments from Japan’s top diplomatic official suggesting a strong response to a Chinese move over Taiwan triggered a sharp risk-off tone in Asian markets. That risk-off shift ended the modest rebound in the Aussie following last week’s positive PMI prints.

Looking ahead, the key drag on the pair is the lack of follow-through on Australia’s improved manufacturing and services data, while the greenback remains supported even as Fed rate-cut expectations face re-assessment. Unless risk sentiment recovers or Australia delivers a fresh positive surprise, AUD/USD is more likely to drift lower than break higher in the near term.

AUD/USD Daily Price History

In the above chart, AUD/USD rates remain in the multi-month range that’s defined price action for the better part of the past seven months; the recent rebound finds the pair moving off of intermediate lows carved out in July and August. Momentum has a slightly bearish tilt, insofar as MACD continues to trend deeper beneath its signal line as each of the 20-day, 50-day, and 100-day exponential moving averages (EMA) sustain a negative slope.

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