AUD/USD Holds Near 0.6607 After RBA Decision, Market Eyes U.S. Labor Data

Officials also highlighted a slowdown in core inflation’s negative dynamics: after peaking in 2022, the Consumer Price Index reached the target range of 2.0–3.0% by Q2 of this year thanks to tighter monetary policy. However, preliminary data for the following period suggest a possible uptick. The accompanying statement also noted stronger domestic demand driven by household consumption, real estate recovery, and easier credit conditions, although productivity in the labor market remains weak despite unemployment stabilizing at 4.2% and wage growth cooling. Facing high uncertainty, the regulator maintains a cautious stance, keeping the option for further action open, which supports the Australian dollar, up 0.9% this week.

The U.S. dollar fell 0.35% in the USDX due to the government shutdown, as Democrats and Republicans failed to agree on either a budget or a temporary funding bill. Key sticking points include healthcare, federal spending levels, subsidies, as well as external aid and domestic projects. Historically, the dollar loses about 2.0% during prolonged shutdowns. Moreover, the probability of a 25 bps Fed rate cut on October 29, according to CME’s FedWatch Tool, rose from 87.7% to 97.8% after weak labor market data and comments from Fed board members.

The next key U.S. labor market data is due October 10: nonfarm payrolls for September are expected to rise from 22,000 to 51,000, which could pressure the dollar further. Otherwise, AUD/USD may retreat toward 0.6545.

Support and Resistance Levels

In the long term, the price remains in an uptrend, though in September it corrected to 0.6545 before rebounding toward resistance at 0.6620. A breakout above this level could open the way to 0.6703 and 0.6810.

The medium-term trend is also bullish: last month, quotes rebounded from the 0.6480–0.6383 zone, updated the July high at 0.6625, and reversed from resistance around 0.6700–0.6677 into a correction. A retest of the 0.6487–0.6465 support area could provide long opportunities targeting 0.6586 and 0.6707.

Resistance levels: 0.6620, 0.6700, 0.6810.

Support levels: 0.6545, 0.6420, 0.6370.

Trading Scenarios and Outlook for the Australian Dollar

Long positions can be opened above 0.6620 with a target of 0.6700 and stop-loss at 0.6579. Timeframe: 9–12 days.

Short positions can be opened below 0.6515 with a target of 0.6420 and stop-loss at 0.6557.