Insights 
VT 
The Australian Dollar (AUD) has risen against the US Dollar (USD), reaching a weekly high near 0.6480, up over 1.20% on Friday. The AUD/USD pair benefits from a weaker US Dollar and steady risk sentiment, though it remains in a tight range. Resistance is expected at the 0.6500 level due to a descending trendline.
The Aussie gains further support from positive global trade developments, as China and the US agreed to keep communication channels open. The recent price movements form a bullish pennant, indicative of a continuation after strong gains, following a rebound from April’s low near 0.5900. Price activity remains cautious with bulls hesitant to make new bets.
Support Levels and Momentum Indicators
Supportive levels include the 0.6400 mark, aligning with the 21-day EMA at 0.6414, suggesting buyers maintain control. A breakout above the pennant’s upper boundary near 0.6480–0.6500 could prompt movement towards 0.6550, a level unseen since November 2024. Momentum indicators favour continued gains, with the RSI at 57.3, above the neutral 50 mark, and a positive MACD signal.
Overall, maintaining levels above the 21-day EMA supports a bullish outlook, with a break past 0.6500 potentially triggering further gains towards 0.6550. Falling below 0.6400 would challenge this upward momentum.
At present, the AUD/USD pair finds itself slightly off balance—testing familiar waters but not yet committing to a firmer breakout. The price action around the 0.6480–0.6500 zone, having stalled several times, may nudge participants to hold off on building new directional positions until clarity improves. With the pair tracing out a bullish continuation pattern, any decisive move past the top of that formation could act as permission for additional upside. However, firmness is essential—any rejection at that level might feed into a short-term unwind.
From our view, support near 0.6400 appears durable for now. This is bolstered not just by the historically reactive 21-day EMA, but also by the failure of bears to push past that point meaningfully across the past few sessions. Momentum readings continue to lean positive—RSI holding above the midpoint tells us there’s underlying confidence, even if cautious. With MACD also trending supportive, short-term dips may still be approached as buying opportunities rather than the start of a broader pullback, provided 0.6400 holds.
Market Context and Positioning
Yet, it’s the compression within the pennant that keeps things delicate. This pattern usually resolves with continuation—not always, but often. A daily close north of 0.6500 would validate that expectation and put 0.6550 on the table, a zone we’ve not traded at since last November. That alone could draw in short-term momentum inflows that have been cautiously waiting for a high-conviction setup.
The context around this is perhaps more instructive than the pair’s numbers. The softening of the greenback has amplified the Aussie’s strength by default. But more than that, reassurance about smoother trade lines between Beijing and Washington means reduced pressure on Asia-Pacific currencies overall. That environment reduces the need for passive hedging, and in risk-adjusted models, the AUD becomes less constrained.
Should newer bids fail to materialise near the 0.6450–0.6500 region, the risk shifts towards re-testing 0.6400. A sustained break below there—particularly with EMA support surrendered—would disrupt short-term bullish setups. Traders may respond with lower exposure or even rotation out towards alternative pairs offering clearer risk/reward alignment.
As it stands, areas above 0.6480 are not simply resistance—they’re tests of intent. If that threshold remains unbroken for the better part of the new week, it could spark questions over the strength of the supposed continuation. Any fade in momentum indicators, such as RSI slipping below 50 or MACD flattening, should be watched closely. Not as red flags per se, but as hints that conviction may be thinning out.
In terms of positioning, outcomes closer to the top of the range demand less urgency. Scenarios where the AUD breaches 0.6500 with clear volume support and closes above that line suggest renewed energy. The type that prompts reassessment in positioning models. Until then, traders may find it useful to reduce expectations for outsized moves upward while the pair remains knotted below that resistance line.
