AUD/USD traded near 0.7160 on Thursday as the US Dollar strengthened after US data. Weekly Initial Jobless Claims rose to 215K from 212K.
S&P Global PMIs increased, with Manufacturing PMI at 54.1 from 52.5 and Services PMI at 51.3 from 49.8. Higher yields supported the US Dollar and added pressure on the Australian Dollar.
Near Term Bias Remained Lower
Falls in AUD/USD were limited as the Reserve Bank of Australia maintained a hawkish bias due to sticky inflation. Near-term trading stayed tilted lower as stronger US data and cautious sentiment guided moves.
On the four-hour chart, AUD/USD was at 0.7159 and stabilised around the 20-period SMA near 0.7159. It remained above the 100-period SMA at 0.7063, while the RSI near 52 pointed to consolidation.
Resistance levels were seen at 0.7163 and 0.7167. Support was at 0.7159, then 0.7137 and 0.7133, with 0.7063 as deeper support.
The technical section was produced with help from an AI tool.
One Year Later The Trend Confirmed
Around this time in 2025, we saw the AUD/USD consolidating around 0.7160, with strength in the US economy putting pressure on the pair. The Reserve Bank of Australia’s hawkish stance provided some support, creating a tense balance. This situation highlighted a conflict between strong US data and Australia’s fight against inflation.
Looking at today, April 23, 2026, that downside bias has clearly played out over the past year, with the pair now trading near 0.6550. The RBA’s hawkishness eventually faded as Australian inflation cooled to 3.2% in the latest quarterly reading, while the US economy maintained its momentum. This divergence is why holding US dollars has been more profitable than holding Australian dollars.
The resilience in the US labor market we observed in 2025 was not temporary. Recent US Initial Jobless Claims are still hovering around 220,000, continuing the trend of a tight labor market that has consistently supported the dollar. This ongoing strength suggests the Federal Reserve has less pressure to cut interest rates aggressively compared to its global peers.
This has kept the interest rate differential firmly in the US dollar’s favor, with the Fed funds rate at 4.75% against the RBA’s cash rate of 3.85%. This gap makes it costly to hold long positions in the AUD/USD, encouraging selling pressure. The market is pricing in this reality, a sharp contrast to the debate we saw a year ago.
For the coming weeks, traders should consider buying put options on the AUD/USD to hedge against or profit from further declines. This strategy offers a defined risk, limited to the premium paid, while providing exposure to potential downside toward the 0.6400 level. Implied volatility remains moderate, making option premiums relatively affordable.
Alternatively, for those anticipating a temporary bounce from oversold conditions, selling cash-secured puts at a lower strike price, such as 0.6450, could be a viable strategy. This allows for collecting premium income while defining a more attractive entry point if the pair does fall further. This approach benefits from the persistent downward pressure while acknowledging the possibility of short-term exhaustion.
