Aussie Climbs as Oil Drop Sparks Risk Rally

AUD/USD was up by more than 0.6% on Wednesday as the Australian Dollar found support in a more constructive global backdrop and a pause in the recent surge in oil prices tied to the Iran conflict. While energy markets remain elevated, the absence of a fresh leg higher has helped stabilize inflation expectations, offering some relief to risk-sensitive currencies like the Aussie. Policymakers remain focused on whether energy-driven price pressures will prove persistent, even as growth risks linger. With the Federal Reserve maintaining a data-dependent stance and U.S. yields easing at the margin, AUD/USD’s move higher reflects a recalibration of rate expectations as markets weigh how both central banks respond to the same oil-driven shock.  

AUD/USD Daily Price History

In the above chart, AUD/USD are attempting to ward off a top. The 2024 high at 0.6943 served as support for a chunk of January through March, but deterioration in recent days saw the bullish technical structure damaged. AUD/USD has now rallied off of the daily 100-EMA (exponential moving average), attempting to trade back through its 2024 high. Momentum is starting to turn the corner, with Slow Stochastics leaving oversold territory while MACD needs just one more green daily close to issue a buy signal (albeit below its signal line). Failure at 0.6943, however, would see AUD/USD fade below its daily 20- and 50-EMAs, which would reinforce the topping perspective. 

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