**AUD/USD Outlook: 2025 Highs in View as Bulls Anticipate Channel Break Ahead of Inflation Data**
_Source: Forex.com, original article by Matt Weller. Supplementary insights from recent commentary by DailyFX analysts._
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The AUD/USD currency pair has garnered significant attention as it pushes toward new 2025 highs. Investors and traders are closely monitoring price action, as bullish signals indicate a possible breakout above the established trend channel. The focus intensifies with the release of crucial inflation data looming, an event that could propel the pair in either direction. Here, we delve deep into the current technical and fundamental landscape of AUD/USD, providing an in-depth outlook for the coming weeks.
### Technical Overview: AUD/USD Riding a Bullish Wave
The AUD/USD pair has showcased notable resilience in recent trading sessions, climbing to levels not seen since early 2023. This upward momentum is rooted in several technical and macroeconomic factors.
**Key Technical Highlights:**
– **Ascending Channel Formation:**
Since late last year, the currency pair has been contained within a clear upward-sloping channel. This pattern began to emerge after the pair rebounded from the 0.6300 region, establishing a series of higher lows and higher highs.
– **Breakout Attempt at Channel Resistance:**
As of this week, AUD/USD is once again testing the channel’s upper resistance, situated just above 0.6700. Previous attempts to breach this level in recent months were met with selling pressure, but each subsequent pullback has found firmer support at higher levels.
– **Potential for a Sustained Rally:**
A clean breakthrough above the 0.6700-0.6730 band could validate the bullish scenario. This would likely expose the currency pair to further gains, with the next resistance levels sitting at 0.6800 and possibly 0.7050 if bullish momentum accelerates.
– **Moving Averages:**
The 50-day and 200-day simple moving averages (SMAs) reinforce positive momentum. The pair remains well supported above these averages, indicating buying pressure is persistent as traders position for further advances.
– **Relative Strength Index (RSI):**
On the daily chart, the RSI hovers near the overbought region. While this typically signals potential for a short-term pullback, in trending markets such readings often precede a breakout rather than a reversal.
### Fundamental Factors Driving AUD/USD Higher
The strengthening performance of the Australian dollar against the greenback is not purely a technical story. Several fundamental factors support the rally.
**1. Shifting Interest Rate Dynamics**
– **RBA Stance:**
The Reserve Bank of Australia (RBA) has adopted a relatively hawkish footing compared to the US Federal Reserve. While Australian inflation remains well above the RBA’s target, policymakers have refrained from rate cuts, signaling concerns about sticky price pressures in services and housing.
– **Federal Reserve Outlook:**
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