The AUDUSD currency pair is currently fluctuating within a range, with a slight bullish tilt following the Reserve Bank of Australia (RBA) keeping its benchmark rate unchanged, instead of cutting rates as expected. This decision boosted the Aussie dollar and pushed the AUDUSD higher. However, attempts to break through key resistance levels between 0.6535 and 0.6556 have failed, as prices fell due to a stronger US dollar. Earlier this week, sellers had a chance when the AUDUSD dropped below the 200-bar moving average on the 4-hour chart, but the RBA’s decision reversed this trend, lifting prices above both the 100-bar and 200-bar moving averages at roughly 0.6522 and 0.6506. The pair remains in a swing area, maintaining a neutral but slightly bullish outlook because it is above these moving averages.

Sellers and Buyers Strategies

For sellers to regain strength, they must break below the 100-bar and 200-bar moving averages consistently, with a target set at a 50% retracement around 0.64809. On the other hand, bulls need to regain the 0.6556 level and aim for recent highs near 0.6590 to strengthen their position for further gains. The pair is currently in a standoff, influenced by central bank decisions and technical levels. So far, the market’s response to the RBA’s pause in rate cuts has been quite typical. By not lowering rates, the RBA provided the Australian dollar with a sense of resilience. This caused the AUDUSD to rise but not firmly enough to surpass the ceiling around 0.6556. Each time the pair approached this level, it faced resistance, indicating that buyers are hesitant without a strong reason to push higher. The recent price movements have positioned the pair slightly above the 100- and 200-bar moving averages on the 4-hour timeframe, offering some comfort to long-position traders. These averages—around 0.6522 and 0.6506—are now short-term benchmarks. As long as prices stay above these levels, it suggests a modest underlying strength.

Market Dynamics and Price Action

A move below these averages, however, would shift the focus back to sellers. Such a drop would not merely be a minor setback; it would open opportunities for a test of the 50% retracement level at 0.64809. This level is significant not only because it represents the midpoint of the latest swing, but also because traders have shown interest in it recently, even if briefly. The price action reflects a battleground where both buyers and sellers have met. On the flip side, buyers will feel more at ease if they can reclaim the area above 0.6556 and push towards recent highs around 0.6590, breaking free from the current sideways movement. Recently, the price has bounced between tight boundaries, but if the upper limit is broken and held, the chart’s character will change from indecision to a more structured upward movement. Our focus is not on dramatic breakouts or reversals. Instead, we keep an eye on how the pair behaves around clearly defined technical areas—especially near moving averages and retracement levels. These indicators are not random; they mark real pivots where interest frequently arises. The short-term volatility isn’t the main concern—it’s about establishing a consistent direction. This requires strong commitment from one side, which has been missing so far. Daily trading ranges are tight, caught between cautious optimism from Australia’s rate outlook and pressure from the stronger US dollar. From our perspective, this standoff offers a clear framework. Movements toward and away from these key levels can serve as practical entry points if they align with larger trends. Reactions should be quick and responsive during this range-bound phase. Pay attention to how the market opens and closes around these levels; they will indicate when one side finally gains enough traction to influence the next significant price move. Create your live VT Markets account and start trading now.

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