AUD/USD traded in a tight range near 0.7075 during Wednesday’s European session. Traders are waiting for the FOMC minutes at 19:00 GMT and Australia’s January jobs report on Thursday.
Ahead of the minutes, the US Dollar Index (DXY) rose 0.2% to around 97.30. Markets will study the minutes for clues about the Federal Reserve’s next policy moves.
Key Labor Data In Focus
Australia’s data is expected to show 20K new jobs in January, down from 65.2K in December. The unemployment rate is forecast at 4.2%, up from 4.1%.
Earlier this month, the Reserve Bank of Australia raised the Official Cash Rate by 25 basis points to 3.85%. It also signaled that more rate hikes were still possible.
On the daily chart, AUD/USD was steady near 0.7075. The 20-day EMA is rising and sits at 0.6999. The 14-day RSI was 64 after easing from overbought levels.
Support sits near the 20-day EMA at 0.6999. A break above the three-year high near 0.7150 could open a move to 0.7200. A daily close below the EMA would likely weaken momentum.
How Traders May Be Positioned
Australia’s seasonally adjusted Employment Change measures the monthly change in the number of people employed. Stronger results can lift the Australian Dollar, while weaker results can pressure it.
AUD/USD is showing a familiar pattern, but the backdrop is very different today, February 18, 2026. Spot is hovering near 0.6750, well below the bullish levels seen at this time last year. This points to changing economic conditions in both Australia and the United States.
In early 2025, the pair held above 0.7000 and followed a clear uptrend. The Aussie was supported by a more hawkish RBA after it lifted rates to 3.85%. Markets were also watching jobs data, with forecasts calling for slower employment growth that could test the currency’s strength. Even so, traders largely expected more RBA tightening, so pullbacks in the pair often looked like buying opportunities.
The January 2025 employment report surprised to the upside. Job gains came in well above the 20,000 forecast, and AUD/USD broke through the 0.7150 resistance area. That result strengthened the uptrend and rewarded traders who held long positions or bought call options into the release. It also showed how, in a strong uptrend, a positive data surprise can move price more than expected.
Now the picture has changed as major central banks have shifted course. The RBA cash rate is 3.10% after several cuts in late 2025 meant to support a cooling economy. The Federal Reserve has also started easing, with its benchmark rate now at 4.75% as inflation has moderated.
Recent data supports a more cautious view. Australia’s unemployment rate for January 2026 rose to 4.5%. China, a key trading partner for Australia, has also reported slower industrial production. This is a sharp contrast to the stronger growth mood that helped the Australian dollar in early 2025.
With this backdrop, derivative strategies may need to change. Rather than buying dips as many did last year, traders may treat rallies toward 0.6800 as chances to buy put options or build bearish put spreads to hedge further downside. Selling call options near key resistance levels may also make sense if upside looks limited.
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