AUD/USD extended Friday’s rebound and edged back towards 0.7000, helped by firmer Chinese data, while remaining boxed between 0.6900 and just above 0.7000. The advance came even as the US Dollar found support from rising US Treasury yields and expectations of further Federal Reserve tightening in Q4. Technically, the pair stays vulnerable below the 200-day SMA around 0.7040 to 0.7045, with the 100-day SMA at 0.7037 and the 55-day SMA at 0.7076 adding overhead pressure. AUD/USD was last cited at 0.6978; resistance levels include 0.7079, then 0.7140 and 0.7280, while supports sit at 0.6894, 0.6860 and 0.6833, with deeper levels at 0.6660, 0.6593, 0.6414 and 0.6373. Momentum gauges show RSI (14) just under 50 and ADX (14) near 39.
Australian Economic Indicators
Australia’s macro picture remains mixed: manufacturing PMI cooled to 49.6 in September and services to 51.9, while the trade surplus narrowed to A$0.495bn from A$1.351bn. GDP rose 0.4% QoQ in Q2 2026 versus 0.3%, but eased to 2.1% YoY from 2.5%; unemployment held at 4.7% as employment fell 39.3K after a 29.3K rise. Trimmed Mean inflation was 3.6% YoY, headline CPI 4.0%, and inflation expectations 5.3%; the RBA expects inflation back on target in early 2028, after lifting the OCR 25bp to 4.60%, with markets pricing just over 9bp more by year-end.
China Data and Market Positioning
China grew 4.5% YoY in Q3; industrial output rose 5.5% YoY and 5.3% YTD, retail sales 1.1% YoY, and September’s trade surplus was $133.53bn. China’s PMI readings improved, with official manufacturing at 50.1 and services at 50.2, while private surveys showed manufacturing at 52.1 and services 51.6; CPI rose 0.9% YoY and 0.2% MoM, PPI 5.0% YoY, and the PBoC is seen holding LPR at 3.00% (one-year) and 3.50% (five-year). Positioning stayed defensive: CFTC net shorts were almost 117.3K contracts, weekly change just over 18.7K and four-week change nearly -78.4K, with open interest near 339.5K; speculative exposure was -34.6% and percentile 33.7, while the net position percentile sat near 0.0. Options skew mirrored that tone, with the one-month 25-delta risk reversal at -1.047 vol points and a one-month change of -0.302 versus an expected -0.220, leaving a -0.082 residual.
