AUD/USD is consolidating sideways around 0.6566, reflecting a neutral stance as traders await Australia’s Q2 inflation print. Reserve Bank of Australia (RBA) Governor Michele Bullock has reiterated the need for a balanced approach—signaling no rush to cut rates, even as inflation accelerates. She emphasized that 50 bps of rate adjustments since February are sufficient for now, with CPI near the lower end of the 2.0–3.0% target and labor market strength peaking. The RBA remains responsive to incoming data, ready to adopt a dovish tilt if conditions warrant.

Inflation figures for Q2, due Wednesday at 03:30 (GMT+2), are expected to show a quarterly CPI slowdown from 0.9% to 0.8% and an annual decline from 2.4% to 2.2%. The trimmed mean is also forecast to slip from 0.7% to 0.6% quarterly and from 2.9% to 2.6% yearly.

US Dollar Steady Pre-FOMC, Aussie Faces Key Test

The US Dollar Index (USDX) holds at 97.37 as investors await the Fed’s policy decision Wednesday. President Trump’s less combative stance toward Fed leadership was received positively by markets. With inflation still climbing, the CME FedWatch Tool shows a 96.9% probability of the Fed holding rates at 4.25–4.50% in August, with changes only likely in the autumn.

Technical Analysis: Support and Resistance

AUD/USD in consolidation near resistanceAUD/USD in consolidation near resistance

On the daily chart, AUD/USD trades near the upper boundary of a broadening formation pattern (dynamic range: 0.6700–0.5800). Technical signals lean bullish: fast EMAs on the Alligator indicator remain above the signal line, and the AO histogram is positive with mild corrective bars.

Resistance levels: 0.6600, 0.6720
Support levels: 0.6520, 0.6370

Trading Scenarios and Forecasts

  • Primary Scenario (Buy Stop):
    Entry: 0.6600
    Take Profit: 0.6720
    Stop Loss: 0.6530
  • Alternative Scenario (Sell Stop):
    Entry: 0.6520
    Take Profit: 0.6370
    Stop Loss: 0.6600
  • Key levels for both scenarios: 0.6370, 0.6520, 0.6600, 0.6720

A breakout above 0.6600 supports new longs targeting 0.6720 (stop: 0.6530). Alternatively, a drop below 0.6520 opens room for shorts to 0.6370 (stop: 0.6600). Weekly timeframe preferred for both strategies.