AUD/USD has paused after rising to 0.7099, then easing to about 0.7072. It remains above the 50 EMA at 0.6797 and the 200 EMA at 0.6611, with the uptrend starting near 0.6421.
The pair has rallied sharply from around 0.6500 and has traded above 0.7000 for the first time since February 2023. The widening gap to the 50 EMA suggests the move is stretched, alongside the RBA’s 25 basis point rise to 3.85% and a more dovish Fed path.
Technical Levels And Momentum
The Stochastic Oscillator (14, 5, 5) is near overbought levels, pointing to slower momentum. Resistance is at 0.7099, then the 2023 high near 0.7157, while support sits at 0.7000, then about 0.6950 and 0.6896.
Focus turns to US January Non-Farm Payrolls on Wednesday, delayed from February 6 to February 11 due to a partial government shutdown. Forecasts point to 70K versus December’s 50K, alongside an annual benchmark revision and unemployment data; Fed speakers Schmid, Bowman, and Hammack are also scheduled.
The AUD is influenced by RBA policy and its 2–3% inflation goal, China’s demand, and iron ore exports worth $118 billion a year (2021). Trade balance and wider risk sentiment also affect the currency.
The rally in AUD/USD has indeed paused, as today’s US Non-Farm Payrolls report came in much stronger than anticipated. The market was looking for a 70k gain, but the actual number printed at a surprisingly high 353k, forcing a sharp reversal from the 0.7100 handle. This powerful data point is causing traders to question the Federal Reserve’s dovish outlook.
Options Positioning After The Data
We see this pullback as a healthy correction after the steep, uninterrupted climb from the 0.6500 level we saw back in late 2025. The overbought stochastic oscillator was a clear warning, and this strong US jobs report provided the perfect trigger for a downturn. The pair is now testing the psychological 0.7000 level as immediate support.
For derivative traders, this sudden shift suggests buying put options to hedge long positions or to speculate on a further decline towards the 0.6950 support area. The strong US data could delay Fed rate cuts, narrowing the policy divergence with the Reserve Bank of Australia that has fueled this rally. This change in fundamentals supports a weaker AUD/USD in the coming weeks.
Conversely, this dip could present an opportunity for those still bullish on the pair’s long-term trend. Purchasing call options with strike prices near current levels offers a cost-effective way to position for a potential bounce. Remember, the RBA’s cash rate is holding firm at 4.35%, which provided a strong tailwind for the currency throughout the last quarter of 2025.
We must also consider the mixed signals coming from Australia’s key trading partner, China, whose recent PMI data has struggled to show consistent expansion. While iron ore prices have remained supportive, recently trading above $120 per tonne, any significant slowdown in Chinese industrial activity could cap the Aussie dollar’s strength. This backdrop of conflicting fundamental drivers increases the case for volatility.
Given the event has now passed, the high implied volatility seen leading into the NFP release will likely decrease. This makes strategies like selling covered calls against existing long holdings an attractive option for generating income. It allows us to profit from a potential consolidation phase as the market digests today’s surprising jobs number.
