The Australian Dollar Outlook
The Australian Dollar (AUD) is expected to decline further, though it currently lacks the momentum to revisit the low of 0.6443 from earlier this week. According to UOB Group’s analysts, the next level of concern is 0.6440.
In the next 24 hours, AUD is expected to edge lower, though it might not reach the 0.6443 low. Another support level to watch is 0.6460, with resistance at 0.6495. A break above 0.6515 would indicate a reduction in the current downward pressure.
Over the past week, narratives suggested further AUD declines are possible, with a focus on reaching 0.6440. Despite a sharp decline and subsequent rebound, there has been no clear increase in downward momentum. A strong resistance level is now set at 0.6530, slightly revised from 0.6545.
Market Observations and Insights
Given the outlook for the Australian dollar, our focus should be on strategies that benefit from a gradual decline or a cap on its upward potential over the next few weeks. We could consider selling AUD/USD call options with a strike price safely above the 0.6530 strong resistance level. This position would generate income as long as the pair stays below that ceiling, aligning with the view that upward momentum is limited.
This bearish stance is supported by diverging central bank policies. The US Federal Reserve continues its “higher for longer” narrative, reinforced by the September 2025 inflation report which showed core CPI remaining stubbornly above 3%. In contrast, minutes from the Reserve Bank of Australia’s last meeting were decidedly dovish, increasing market expectations for potential rate cuts in early 2026 to support a slowing domestic economy.
The weakness is compounded by recent economic data from China, Australia’s largest trading partner. China’s third-quarter GDP for 2025 came in at 4.2%, missing expectations, while iron ore prices have recently slipped below $100 per tonne. These factors directly pressure Australia’s terms of trade and weigh heavily on the value of its currency.
Options for a Bearish Strategy
For those looking for a more direct bearish play, buying put options with a strike near 0.6450 is a viable strategy, targeting the 0.6440 level. However, given the view that momentum is not strong, structuring this as a debit spread by selling a lower-strike put could help reduce the initial cost. This approach benefits from a slow grind lower without requiring a sharp, immediate drop.
Looking back, we’ve seen the mid-0.6400s act as a key battleground for the AUD/USD pair throughout 2024 and 2025. A decisive break below the 0.6440 support could trigger a more significant move down. Therefore, setting profit targets on short positions around this level seems prudent for now.
เริ่มซื้อขายทันที – คลิกที่นี่ เพื่อสร้างบัญชีจริงของ VT Markets
