Why is AUD/USD down 0.7% today?

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Aud/usd slides 0.71% today

Highlights

Australia's Unemployment Rate increased to 4.7% in August from 4.6%, dampening expectations for additional Reserve Bank of Australia rate hikes.
AUD/USD saw heavy selling and extended its decline against the US Dollar following the labor market data.
AUD/USD trades below key moving averages with strong downside momentum, expected to consolidate between $0.6866 and $0.6942 in the near term.

RBA rate hike bets fade as unemployment rise weighs on sentiment

Recent Australian employment data showed an increase in the Unemployment Rate to 4.7% from 4.6% in August. This development reduced expectations of further rate hikes by the Reserve Bank of Australia, which contributed to heavy selling pressure on AUD/USD. The labor report directly undermined sentiment and led the pair to extend its retreat against the US Dollar.

Anton Kharitonov, expert at Traders Union, sees AUD/USD as trapped in a bearish structure. He identifies the weaker-than-expected jobs data and fading RBA rate hike hopes as critical risks. The price remains pressured below all key moving averages, and daily technicals display persistent downward momentum. Kharitonov points to concerning volatility and a strong probability of further declines under $0.6866. "Short-term bounces are likely to find sellers, so I view any recovery towards $0.6942 as an opportunity for defensive positioning," he notes.

Viktoras Karapetjanc, expert at Traders Union, sees recent labor data as a temporary obstacle for AUD/USD. He believes the volatility band offers new trading opportunities, and that market sentiment remains efficient in adjusting to macro shifts. Karapetjanc expects downside to be well contained and looks for a move higher if resistance at $0.6942 is broken. "I am confident the market will reward patient bulls as soon as momentum shifts and the pair regains traction above the technical ceiling," he says.

Parshwa Turakhiya, analyst, highlights that sentiment remains fragile after the disappointing employment figures. He notices immediate intraday pressure yet also flags the BBP divergence as a sign of possible short-lived reversal attempts. In his view, near-term opportunities could emerge if volatility persists inside the current corridor. "Traders should stay nimble and look for quick setups between $0.6866 and $0.6942 as sentiment continues to drive the action," Turakhiya advises.

Bearish momentum persists as all trend signals align lower

AUD/USD currently trades below the 20-day, 50-day, and 200-day moving averages, with the short-, medium-, and long-term trend structure reflecting ongoing pressure from sellers. The near-term ceiling is now set at $0.6909 and the near-term floor at $0.6866, with the Ichimoku Kijun at $0.7023 confirming a bearish trend. Daily momentum is negative, with the Moving Average Convergence Divergence (MACD) and Average Directional Index (ADX) both signaling strong selling pressure. The Relative Strength Index (RSI) stands at 39.47, reflecting a 'Sell' bias, while the Stochastic RSI is deep in the overbought zone at 85.50. Commodity Channel Index (CCI) and Awesome Oscillator (AO) remain neutral, and Bull/Bear Power (BBP) shows buyers with a slight upper hand intraday. The pair is trading at $0.6904, slipping 0.71% after opening nearly flat, currently positioned near the session low. Intraday volatility stands at 0.68%. The technical tone is weak, with indicator signals and intraday movement aligned to the downside except for BBP, which shows a divergence amid lingering pressure.

Earlier, analysts noted that AUD/USD was under sustained bearish pressure as technical signals remained weak despite policy support from the Reserve Bank of Australia. The latest downside breakout, triggered by disappointing labor market data, reinforces the bearish trend, making a close watch on the $0.6866 support crucial for assessing further downside risk in the coming days.

Source of Data: AUD Price Analysis by TU

The analysis is based on a proprietary model combining technical, on-chain, and expert data. Not investment advice. See methodology

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