AUD/USD Technical: Further potential Aussie strength towards range resistance as RBA looms

[Ben Graham]

After Australia’s central bank (RBA) shocked market participants with its prior monetary policy decision in July to stand pat on its short-term cash interest rate at 3.85% in defiance of overwhelming expectations of a rate cut, the consensus forecast now is a 25 basis points cut to lower the cash interest rate to 3.6% on Tuesday meeting, 12 August as inflation pressures subsided.

Q2’s trimmed mean gauge of inflation in Australia cooled to 2.7% from 2.9% in Q1, inching down closer to the midpoint of RBA’s 2%-3% inflation target. Even the monthly CPI rose by 1.9% y/y in June, easing from May’s print of 2.1%.

Hence, RBA’s third interest rate this year, which is set for Tuesday’s monetary policy meeting, is likely to have been fully priced in.

Let’s decipher the short-term movements of the AUD/USD from a technical analysis perspective.

Fig. 1: AUD/USD minor trend as of 11 Aug 2025 (Source: TradingView)

Preferred trend bias (1-3 days)

The recent 205-pip minor corrective decline seen in the AUD/USD from the 24 July 2025 high to the 1 August 2025 low stalled right above its key 200-day moving average, and the lower boundary of a medium-term “Expanding Wedge” range configuration in place since the 23 April 2025 low.

Bullish bias with 0.6480 as key short-term pivotal support for the next intermediate resistances to come in at 0.6540/6550 and 0.6580 (also the upper boundary of the minor ascending channel).

Key elements

• The AUD/USD has been evolving within a minor ascending channel in place since the 1 August 2025 low of 0.6420, which suggests an ongoing minor uptrend phase. Also, price actions have managed to hold above the 20-day moving average since last Friday, 8 August 2025.
• The hourly RSI momentum indicator has managed to stage a bounce at a parallel ascending support at the 43 level.
• The discount yield spread between the 2-year Australian sovereign bond and US Treasury note has continued to narrow since 1 August 2025, from -0.55% to -0.44% which may in turn support further potential upside in AUD/USD as the 2-year Treasury note is getting less attractive to own in terms of yield differential.

Alternative trend bias (1 to 3 days)

A break below 0.6480 invalidates the bullish tone to open up scope for another round of choppy corrective decline to expose the next intermediate supports at 0.6450, and 0.6420.

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