The AUD/USD is predicted to range between 0.6570 and 0.6605, with a chance of declining further. Analysts Quek Ser Leang and Peter Chia note that the likelihood of the AUD falling below 0.6555 is increasing. In the last 24 hours, the AUD dropped to 0.6557 before stabilizing at 0.6586, indicating little change. This suggests that trading will continue sideways within the established range of 0.6570 to 0.6605.

Downward Momentum

Recent weeks show a growing downward momentum. The important resistance level is at 0.6630, which is crucial for maintaining our forecasts, as long as it holds. FXStreet offers various updates on the foreign exchange market but does not provide personal investment advice. Notable updates include the Euro recovering some losses against the Swiss Franc and the GBP/JPY declining after a four-day rally. Additionally, the ECB has confirmed its commitment to a steady approach in the Eurozone. The GBP/USD has fallen to a three-week low, while Gold is hovering near record highs. The cryptocurrency market is currently experiencing profit-taking and a risk-averse sentiment.

Sideways Phase Strategy

Current trading patterns suggest we are in a sideways phase, likely between 0.6570 and 0.6605. Traders aiming to take advantage of this low volatility might consider selling an options strangle with strikes outside of this range. This strategy profits if the currency pair remains stable in the short term. Yet, the chances of the AUD falling below the key support level of 0.6555 are rising. To prepare for this potential decline, buying put options with a strike price around 0.6550 could be wise. This approach offers downside exposure while keeping risk limited to the premium paid. A bearish outlook is supported by differing central bank policies. Australia’s CPI data for September 2025 shows inflation dropping to 3.2%, increasing speculation that the Reserve Bank of Australia will keep rates steady. Meanwhile, a recent strong U.S. jobs report keeps the Federal Reserve on a tight course, which favors the US dollar. External factors are also impacting the Aussie dollar. Iron ore prices, a key Australian export, have fallen to $98 per tonne due to ongoing weaknesses in China’s construction sector. This trend matches patterns seen in 2023 and 2024 where concerns about Chinese demand limited AUD strength. A bear put spread could effectively target a downward move with defined risk. The 0.6630 level remains a strong resistance. As long as prices stay below it, our bearish bias remains. If the price fails to break above this level in the coming week, it may reinforce the possibility of testing the 0.6555 support. Create your live VT Markets account and start trading now.

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