FXStreet Insights Team

The FXStreet Insights Team is made up of journalists who gather market insights from leading experts. They analyze various currency pairs such as EUR/GBP and USD/CNH, highlighting political risks and market conditions. Markets are closely watching Fed Chair Jerome Powell’s speech, with expectations for two more rate cuts this year. Gold prices are rising due to increased demand for safe investments, surpassing $4,100. FXStreet warns that the information shared comes with risks and uncertainties and is not a trading recommendation. It’s crucial to do thorough research before making any investment decisions, as investing carries the risk of loss. We anticipate further declines in the AUD/USD, presenting a trading opportunity. The next key support level is at 0.6440, making put options with a strike price of around 0.6500 appealing for the next few weeks. There’s also strong resistance at 0.6575, which can guide stop-loss orders for short positions.

Market Dynamics and Economic Indicators

This negative outlook is supported by external factors such as Dalian iron ore futures, a vital export for Australia, which fell below $100 per tonne last week for the first time in four months. Additionally, recent inflation data from Australia came in at 3.1%, lower than expected, raising speculation that the Reserve Bank of Australia may cut rates sooner than the Fed. This economic divergence is putting downward pressure on the currency. The US dollar continues to thrive as a safe haven amid ongoing risk aversion, a trend that has persisted through the latter half of 2025. Despite expectations of two more rate cuts by the Fed, the dollar remains strong, backed by surprisingly positive economic data, including last month’s retail sales, which exceeded forecasts. This makes the dollar a favorable option compared to risk-sensitive currencies like the Aussie. We are witnessing a market environment similar to 2023 when a hawkish Fed consistently pushed the AUD/USD lower for long periods. However, attention now turns to Fed Chair Powell’s speech today, which is a significant event risk. Any unexpected deviation from a dovish tone could lead to considerable volatility and disrupt the current downtrend. Create your live VT Markets account and start trading now.

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