US non-farm payrolls surprise leaves Australian Dollar vs US Dollar trading flat

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Australian Dollar drops 0.50% today

Highlights

Robust US payrolls data increased demand for the US dollar and drove AUD/USD lower amid heightened risk aversion.
Australian 10-year yield premium over US bonds shrank to 36 basis points, sharply reducing AUD's relative appeal as consumer confidence weighed.
AUD/USD faces firm bearish momentum with price forecast to consolidate within $0.6958–$0.7028, downside breakout likely if $0.6958 fails.

Hawkish US jobs data and narrowing yield gap weigh on aussie

A stronger-than-expected US non-farm payrolls report prompted renewed demand for the US dollar, reflecting increased risk aversion and placing downward pressure on AUD/USD. The narrowing of the Australian 10-year bond yield premium over its US counterpart to 36 basis points further diminished the attractiveness of holding AUD versus USD, with the yield difference nearly halved since mid-May. Domestic data showing a 2.9% drop in Australian consumer confidence for May highlighted weak sentiment in the face of persistent inflation and ongoing rate hikes, adding to the currency's challenges.

Downside momentum widens as technical signals cluster at resistance

On the H1 chart, AUD/USD is trading below both its MA-20 at $0.7014 and MA-50 at $0.7031, while remaining above the MA-200 at $0.6917, which acts as long-term support. Daily moving average alignment retains a bullish bias, with the Ichimoku Kijun at $0.7016 identified as the immediate resistance level. Technical indicators reinforce the prevailing downside: both MACD and ADX register on Sell, RSI sits at 36.37 (Sell), CCI flags Oversold conditions, and Bull/Bear Power (BBP) indicates sellers control the intraday tone. Stochastic RSI is Neutral, introducing some short-term divergence, while the Awesome Oscillator aligns with the downward bias. Overall, there is broad confirmation of sustained selling pressure.

Bearish bias persists as AUD/USD faces consolidation scenario

In the next two to three sessions, AUD/USD is expected to trade within a range of $0.6958 to $0.7028, marking a typical volatility band relative to current levels. Downside movement retains a high probability, while the chance of an upward reversal remains low unless resistance at $0.7016 is breached. Should price fall below support at $0.6958, renewed bearish momentum is likely to be confirmed, with interim consolidation likely as the baseline scenario.

Anton Kharitonov, expert at Traders Union, sees stubborn headwinds for AUD/USD after risk aversion followed better-than-expected US payrolls. He notes that negative sentiment is underlined by falling Australian yields, weakening local confidence, and key technicals lining up to the downside. The market maintains pressure below short-term moving averages, with buyers showing little commitment. "I see limited upside until resistance at $0.7016 is cleared — base case remains more downside risk ahead."

Earlier, analysts noted that AUD/USD was under persistent short- and medium-term selling pressure, with longer-term support tempering the downside bias. The current environment reinforces this bearish sentiment amid fresh fundamental headwinds, but traders should closely monitor the $0.6958 support zone for signs of either renewed downside acceleration or potential short-term stabilization.

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

The information is based on forecasts and does not constitute investment advice or a guarantee of future results. Market conditions may change. See our Disclaimer and Editorial Integrity for details.