Australian Dollar slides to one-week low, below 0.7100 ahead of jobs data on Thursday
- AUD/USD attracts fresh sellers on Wednesday and is pressured by a combination of factors.
- The AUD weakens in reaction to Australian PMIs, while the hawkish Fed supports the USD.
- Traders now eye Aussie jobs data and the Trump-Xi summit on Thursday for fresh impetus.
The AUD/USD pair comes under heavy selling pressure on Wednesday and weakens further below the 0.7100 mark, hitting a one-week low during the early part of the European session. Spot prices currently trade just above the monthly trough, touched last Thursday, as bears await a sustained break below the 100-day Simple Moving Average (SMA) before positioning for further losses.
The Australian Dollar (AUD) started weakening following the disappointing release of flash PMIs, which showed a slowdown in services activity and a contraction in the manufacturing sector. The softer data seems to have tempered market expectations of a follow-through move by the Reserve Bank of Australia (RBA) after the expected 25 basis points (bps) rate hike next week. This, along with the prevailing US Dollar (USD) buying interest, exerts additional downward pressure on the AUD/USD pair.
The USD Index (DXY), which tracks the Greenback against a basket of currencies, advances to a fresh high since July 30 in the wake of the US Federal Reserve's (Fed) hawkish outlook, signaling one more rate hike this year. Adding to this, geopolitical uncertainties, despite hopes for a diplomatic resolution to end the US-Iran war, continue to underpin the safe-haven USD. In fact, US President Donald Trump threatened that he may “annihilate” the Islamic Republic if a deal isn't reached soon.
Meanwhile, Iranian Foreign Minister Abbas Araghchi met with US Special Envoy Steve Witkoff to restate Tehran's conditions for reopening the Strait of Hormuz. Crude oil prices dropped to an over two-week low in reaction to the positive development, easing inflation fears and keeping US bond yields depressed below multi-year highs. This, however, does little to dent the strong bullish tone surrounding the USD, suggesting that the path of least resistance for the AUD/USD pair is to the downside.
Traders, however, might refrain from placing aggressive bets ahead of the release of the Australian jobs report on Thursday and the crucial Trump-Xi meeting. Hence, it will be prudent to wait for some follow-through selling below a technically significant 100-day SMA to back the case for an extension of the recent retracement slide from a multi-month high, touched earlier this September.
AUD/USD daily chart
Technical Analysis
The AUD/USD pair has now slipped below the 38.2% Fibonacci retracement level, though remains above the 100-day Simple Moving Average (SMA) at 0.7075. A convincing break below the later would expose a deeper protection at the 50.0% retracement near 0.7051 and the 61.8% level at 0.7007.
Failure to defend the said levels would open the way toward the 78.6% retracement at 0.6945 and the broader structural floor around 0.6865. On the topside, immediate resistance is located at the 38.2% Fibo. retracement at 0.7095, followed by a stronger hurdle at the 23.6% level near 0.7150, ahead of the cycle anchor toward 0.7237.
(The technical analysis of this story was written with the help of an AI tool. Know more.)
Australian Dollar Price Today
The table below shows the percentage change of Australian Dollar (AUD) against listed major currencies today. Australian Dollar was the strongest against the New Zealand Dollar.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | 0.31% | 0.36% | 0.24% | 0.17% | 0.48% | 0.54% | 0.24% | |
| EUR | -0.31% | 0.03% | -0.04% | -0.13% | 0.16% | 0.21% | -0.08% | |
| GBP | -0.36% | -0.03% | -0.08% | -0.17% | 0.12% | 0.18% | -0.04% | |
| JPY | -0.24% | 0.04% | 0.08% | -0.06% | 0.21% | 0.29% | 0.05% | |
| CAD | -0.17% | 0.13% | 0.17% | 0.06% | 0.28% | 0.36% | 0.12% | |
| AUD | -0.48% | -0.16% | -0.12% | -0.21% | -0.28% | 0.06% | -0.16% | |
| NZD | -0.54% | -0.21% | -0.18% | -0.29% | -0.36% | -0.06% | -0.23% | |
| CHF | -0.24% | 0.08% | 0.04% | -0.05% | -0.12% | 0.16% | 0.23% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Australian Dollar from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent AUD (base)/USD (quote).
Author
Haresh Menghani
FXStreet
Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.
