AUD/USD moved above its earlier range and reached close to 0.7100. A further rise towards 0.7135 remains possible, while 0.7000 is now marked as key firm support.
On 09 Apr, with spot at 0.7030, the pair was described as having made a rapid move that looked overdone, but still with scope to test 0.7135. To maintain upward momentum, it was said the rate needed to hold above 0.6970.
Key Levels And Near Term Outlook
Near-term resistance levels are 0.7100 and 0.7135. Initial support levels are 0.7060 and 0.7040.
The 0.7135 level was described as major resistance and not expected to be reached soon. The article notes it was produced with the help of an Artificial Intelligence tool and reviewed by an editor.
Looking back to this time last year, we saw a view that the Australian dollar’s surge was overdone but still had room to test higher levels near 0.7135. Strong support was identified around the 0.7000 mark. The momentum then was clearly to the upside, despite signs of being overextended.
However, we know that after peaking shortly after that analysis in April 2025, the AUD/USD pair entered a multi-month decline, eventually falling below 0.6400 by the fourth quarter. This reversal was largely driven by the Reserve Bank of Australia pausing its rate-hiking cycle while the US Federal Reserve maintained its hawkish stance, widening the interest rate differential. This historical price action serves as a crucial reminder of how quickly fundamental drivers can overwhelm technical pictures.
Options Based Ways To Manage Volatility
As of today, April 10, 2026, the pair is trading in a tighter range, hovering near 0.6650. Recent Australian CPI data for the first quarter of 2026 came in slightly above expectations at 3.8%, putting pressure on the RBA to hold rates steady for longer than the market anticipated. This renewed inflation concern is creating significant two-way tension in the market.
Given the memory of last year’s sharp reversal and current inflationary uncertainty, traders should consider using options to manage risk and express a view on volatility. Purchasing a straddle, which involves buying both a call and a put option at the same strike price near 0.6650, would profit from a significant price move in either direction over the next few weeks. This strategy is ideal for a market that feels coiled for a breakout but where the direction is unclear.
For those anticipating that sticky Australian inflation will force the RBA’s hand and push the AUD higher, buying call options is a defined-risk approach. A trader could purchase May-expiry calls with a strike price of 0.6700. This provides exposure to potential upside toward the 0.6800 resistance level while capping maximum loss to the premium paid for the options.
Conversely, if the view is that persistent US economic strength and a firm dollar will dominate, buying put options offers downside protection. Positioning with puts struck around 0.6600 would be a hedge against a break of current support. This would protect a portfolio from a potential slide back towards the 0.6500 level seen earlier in the year.
