**AUD/USD Price Outlook: Sellers Eye 0.6480 as Downward Momentum Persists**
*Based on original analysis by Rajan Dhall, MSTA (FXStreet), with additional insights and developments on AUD/USD dynamics and technical drivers*
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## Overview of the AUD/USD Situation
The Australian dollar (AUD) has been under pressure against the US dollar (USD), as a blend of macroeconomic factors, technical signals, and ongoing global risks tilts the balance in favor of sellers. As per the recent analysis by Rajan Dhall on FXStreet, the pair is facing significant downside momentum, raising the possibility of a move toward the 0.6480 support area. This extended discussion will explore the reasons behind AUD’s weakness, the technical setup guiding traders’ decisions, and the key factors to watch as the market evolves.
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## Market Backdrop: The Macro Landscape
Recent trading sessions have seen the AUD/USD pair struggling to hold ground, broadly subdued by:
– **A resilient US dollar**: Driven by safe-haven flows and robust economic data
– **Central bank policy divergence**: The Federal Reserve’s hawkish stance contrasts with the Reserve Bank of Australia’s (RBA) cautious outlook
– **Weaker commodity prices**: Australian exports are highly sensitive to shifts in global demand and prices, particularly for iron ore, coal, and gold
– **Risk sentiment**: Global equity market jitters have curbed demand for risk-sensitive currencies like the AUD
### US Dollar Strength and Rate Expectations
The US economic backdrop, characterized by steady growth figures and sticky inflation, continues to offer broad support to the USD:
– Recent Consumer Price Index (CPI) and labor market reports indicate persistent inflationary pressures in the US
– Federal Reserve officials, while hinting at eventual rate cuts, have provided little clarity regarding timing or scale, keeping the dollar attractive
– US Treasury yields have remained elevated relative to Australian government bonds, driving capital flows toward the greenback
### The RBA’s Position
The Reserve Bank of Australia has adopted a wait-and-see approach, keeping its policy rate unchanged in the face of subdued inflation and mixed economic data. Expectations for further tightening remain low, given:
– Soft wage growth and consumer spending
– Housing market moderation
– Signs of slower Chinese demand, a crucial factor for Australian exports
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## Technical Analysis: AUD/USD Under the Microscope
**Original technical setup by Rajan Dhall, MSTA (FXStreet):**
– The pair is forming lower highs and lower lows, confirming a bearish trend
– Sellers have been consistent, capitalizing on rebounds to initiate new short positions
### Recent Price Action
– The AUD/USD pair was capped around the psychological 0.6700 level, failing to build upward momentum despite intermittent recoveries
– Strong resistance is observed in the 0.6650/0.6700 band, where previous rallies have faltered
– Support has emerged near 0.652
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