The AUD/USD exchange rate declined on Thursday, weighed down by a strengthening US Dollar (USD) despite a boost from better-than-expected Australian employment figures. The pair was trading near 0.6966, reflecting a 0.45% daily loss.
Gains in the Greenback were driven by rising safe-haven demand amid Middle East conflict, while a subsequent surge in Oil prices fueled inflation fears and increased expectations that the Federal Reserve (Fed) will need to hike interest rates. The CME FedWatch Tool now rates the probability of a September rate increase at 83%, propelling the US Dollar Index (DXY) to around 101.45, its highest point in three weeks.
Technically, AUD/USD remains above both the 21-day and 200-day Simple Moving Averages (SMAs) at 0.6948 and 0.6896, offering a mildly constructive near-term outlook. However, the pair is being capped by resistance at the 50-day SMA level of 0.7028.
The Relative Strength Index (RSI) hovering just below the neutral 50 mark indicates subdued momentum, while the Moving Average Convergence Divergence (MACD) shows a marginally positive but fading signal as the green histogram contracts.
Immediate resistance is seen at the 50-day SMA of 0.7028, followed by the horizontal barrier at 0.7100 and then 0.7250. Support levels are located at the 21-day SMA of 0.6948 and the 200-day SMA of 0.6896, with a sustained break below potentially exposing the 0.6800 level.
