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    Consolidation is expected for AUD/USD, ranging from 0.6880 to 0.6940, with potential upward movement.

    by VT Markets
    /
    Jan 27, 2026

    AUD/USD Pair Performance

    The AUD/USD pair closed at 0.6916. It’s expected to stay between 0.6880 and 0.6940 for now. If the pair can go above 0.6945, it may aim for 0.6985. In the last 24 hours, the AUD peaked at 0.6941 but ended at 0.6916, reflecting a 0.27% increase. However, the upward trend is slowing. This suggests a likely consolidation in the range of 0.6880 to 0.6940. In the next 1-3 weeks, we expect a stronger AUD. To reach 0.6985, it needs to stay above 0.6945. A solid support level is at 0.6840, as long as it holds. Given that the AUD/USD is expected to consolidate between 0.6880 and 0.6940, this creates a chance for range-trading strategies. Option traders might consider selling strangles with strikes outside this range to earn from the expected limited movement. We view this as a temporary pause after the recent rise.

    Fundamental and Market Influences

    We believe that the fundamentals point to a stronger Australian dollar in the coming weeks. Australia’s Q4 2025 inflation data, released last week, was higher than expected at 3.8%. This puts pressure on the Reserve Bank of Australia to keep its hawkish approach. In contrast, December 2025 retail sales in the United States showed a slowdown, strengthening the market’s belief that the Federal Reserve will hold its position. This economic gap is supported by strong commodity prices, with iron ore staying above $130 per tonne due to solid demand. Remember how the pair struggled below the 0.6700 mark for much of Q3 2025. The current strength is a big change from that period. If the pair decisively breaks and holds above 0.6945, it should trigger more aggressive buying. Traders could consider buying call options or starting bull call spreads aimed at the 0.6985 level. Our bullish outlook remains as long as the strong support at 0.6840 holds, which can act as a key stop-loss level or for buying protective put options. Create your live VT Markets account and start trading now.

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