Insights 
VT 
Key Points:
- AUD/USD rebounds to 0.6407 as China’s April exports jump 8.1% y/y.
- Weekly losses persist as Fed’s hawkish hold and RBA cut bets pressure Aussie.
The Australian dollar climbed to 0.6407 on Friday after upbeat Chinese export data helped pare earlier losses. Still, the pair remains poised for a 0.7% weekly decline, snapping a four-week winning streak amid shifting interest rate expectations and renewed U.S. dollar strength.
China’s exports rose 8.1% in April year-on-year, with factories front-loading shipments ahead of the U.S. tariff hike that took effect earlier this month. Imports declined but at a slower pace, offering relief to commodity-linked currencies like the Aussie.
Technical Analysis
AUDUSD drifted lower throughout the session, touching a low of 0.63706 before staging a modest rebound. The MACD histogram has flipped into bullish territory, with a fresh crossover just as the price began reclaiming ground above the 5- and 10-period moving averages. The short-term recovery appears constructive, but overhead pressure remains near 0.64100–0.64200, where the 30-period moving average and prior support-turned-resistance converge.
Picture: AUDUSD bounces from 0.6370 low with MACD turning bullish, but 0.6420 remains key near-term hurdle, seen on the VT Markets app
For bulls to gain meaningful traction, the pair needs to break and hold above 0.64200, otherwise this may be a corrective bounce within a broader downtrend. A drop back below 0.63900 could see momentum reset toward the week’s low.
Kiwi Falters and Rates Hold
The Kiwi dollar also slipped, falling 0.2% to 0.5892, extending its weekly decline to 0.9%. A break below 0.5894 marks a bearish signal, though support lingers near the 200-day moving average at 0.5882.
Behind the scenes, a hawkish tone from the Federal Reserve has scaled back bets on rate cuts this year. Market pricing now implies just 68 basis points of easing in 2025, down from 78 bps a day earlier. This has lifted the dollar across the board, with AUD and NZD underperforming.
President Donald Trump’s trade pivot also drove sentiment. While the Fed held rates steady, Trump’s announcement of a U.S.-UK trade deal and commitment to maintain Chinese tariffs has introduced volatility ahead of the U.S.-China meeting.
Rate cut expectations remain firm for the Reserve Bank of Australia, with markets fully pricing a 25bp reduction to 3.85% on May 20. Across the Tasman, the RBNZ is also expected to ease, with Westpac forecasting two cuts this year, citing persistent trade-related headwinds.
Cautious Forecast
The Aussie may continue to hover below 0.6450 ahead of next week’s data and central bank expectations. A downside break below 0.6370 could retest 0.6320, while trade optimism could offer temporary support near 0.6410–0.6425. Traders remain focused on tariff developments and Fed policy cues for direction.
