**AUD/USD Price Forecast: Bulls Ease Back as US Dollar Strengthens Ahead of US-China Trade Talks**
*Based on the analysis by Anil Panchal on FXStreet, with additional insights from recent forex market news and data.*
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### Overview
The AUD/USD pair began the session under immense pressure, slipping to multi-week lows as the US Dollar (USD) enjoyed widespread demand. Persistent trade tension between the United States and China, alongside a robust USD environment, has diverted interest away from risk-led currencies like the Australian Dollar (AUD). While bulls have shown enthusiasm in previous sessions, the mounting global uncertainty has led them to scale back their positions ahead of crucial trade negotiations.
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### Key Takeaways
– **AUD/USD has retreated, setting new local lows as the USD advances.**
– **Global risk sentiment weakens amid fresh US tariff threats and upcoming US-China talks.**
– **Traders anticipate increased volatility as economic data and central bank decisions approach.**
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## US Dollar Gains Ground
The US Dollar asserted its dominance against major counterparts, buttressed by optimistic economic data and a safe-haven bid. A few critical drivers for this strength include:
– **Strong economic indicators:** Recent US jobless claims data fell below expectations, signaling continued strength in the labor market.
– **Rising Treasury yields:** US Treasury yields have climbed as investors anticipate further policy tightening by the Federal Reserve, enhancing the Dollar’s appeal.
– **Flight to safety:** With global growth uncertainties resurfacing, particularly surrounding US-China tensions and the fragile pace of global trade, market participants have flocked to safer assets.
The US Dollar Index (DXY), which tracks the Greenback against a basket of currencies, climbed above recent averages, reinforcing the ongoing risk-averse narrative.
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## AUD/USD Technical Picture
AUD/USD has entered a bearish phase, marked by consecutive daily declines. The following technical factors shape the pair’s outlook:
– **Multi-week low break:** After steady slips below 0.6900, AUD/USD pressed toward the 0.6850 region, crossing under both 50 and 100-day moving averages, confirming softness.
– **Downward channel continuation:** The pair has traded within a defined downward channel since late last week, failing to decisively reclaim broken support levels.
– **Oscillator pressure:** Relative Strength Index (RSI) and momentum indicators have signaled continued selling but have not reached oversold levels, suggesting room for further declines.
– **Key support and resistance levels:**
– **Immediate support**: 0.6850, followed by 0.6820 and 0.6800.
– **Immediate resistance**: 0.6900, then 0.6930, and 0.6970.
A daily close below the psychological 0.6800 mark could open the way for a deeper retracement, targeting early-May lows. Conversely, if buyers regain traction and force a close above 0.690
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