Insights 
VT 
The Australian Dollar (AUD) is expected to trade in a range between 0.6460 and 0.6520. Analysts from UOB Group suggest that while current conditions may support this range, further declines are possible, with the next target level being 0.6440.
In recent trading, the AUD dropped to 0.6443 but quickly rebounded to 0.6485, easing immediate downward pressure. Despite this rebound, the potential for movement towards 0.6440 remains, as long as the resistance level of 0.6545 is maintained.
Focus on Resistance Levels
Over the next one to three weeks, the focus will remain on whether further declines will take AUD to 0.6440. Although there has been no marked increase in downward momentum, the possibility remains if key resistance levels are not breached. The analysis reflects insights covered by the FXStreet Insights Team, based on observations from market experts.
For now, we see the Aussie dollar trading in a tight range between 0.6460 and 0.6520. However, the bigger picture suggests a downward trend is more likely in the coming weeks. The key level to watch on the downside remains 0.6440.
This bearish view is strengthened by diverging central bank policies. The latest Australian CPI data for September 2025 came in softer than expected at 3.1%, leading many to believe the RBA is done hiking rates. In contrast, recent labor market data from the US continues to show strength, keeping the Federal Reserve on a hawkish path.
Adding to the pressure, prices for iron ore, a key Australian export, have dipped below $100 per tonne this month on concerns over slowing industrial demand in China. This weakness in commodities directly weighs on the value of the Australian dollar. As long as the Aussie stays below the strong resistance level of 0.6545, the path of least resistance appears to be lower.
Traders Risk Management Strategies
Given the recent sharp rebound from the 0.6443 low, traders might consider buying put options to gain downside exposure while capping risk. A bear put spread could also be effective, allowing traders to profit from a slide towards the 0.6440 target with a defined maximum loss. These strategies seem prudent as long as the 0.6545 resistance level holds firm.
Looking back, we saw the AUD/USD pair test even lower levels, dipping into the 0.63s during late 2023 amid similar global economic concerns. This history suggests a break below 0.6440 is entirely possible if downward momentum builds. The recent volatility underscores the importance of using options to manage risk rather than taking outright short positions in a choppy market.
