Australian Dollar falls against the US Dollar again, with AUD/USD moving towards the 0.6550 mark as revived fears over US tariffs spark global risk aversion. Market mood suffered following confirmation by President Trump to inform trading partners of forthcoming unilateral tariffs, which heightened the specter of a disturbance of global trade—specifically for export-focused economies such as Australia. The currency pair is also dragged down by firmer-than-anticipated US jobs data, which dampened hopes of imminent Fed rate cuts. Technically, AUD/USD is approaching an important support area at 0.6535–0.6545, the neckline of a possible Double Top pattern, which could indicate the potential for a more substantial correction if the level breaks.
KEY LOOKOUTS
• Markets are closely monitoring President Trump’s official letters to trading partners, which have the potential to further augment global trade tensions.
• The 0.6535–0.6545 region is an important neckline support; a breakdown here might see further losses.
• Further robust US labor market data could lower the prospects of Fed rate reductions, helping to support the USD.
• Shifts in global risk appetite, fueled by trade or geopolitical events, would have a major influence on AUD/USD movement.
AUD/USD remains under pressure as international markets prepare for possible disruptions in trade due to renewed threats from US tariffs. President Trump’s assurance that trading partners will receive letters on unilateral tariffs has been a cause of concern among investors, particularly for those economies with a strong export orientation such as Australia. Combined with more robust than anticipated US employment statistics that deflate expectations of near-term Fed rate cuts, sentiment has become cautious. With increasing risk aversion, the Australian Dollar is still exposed, with market players closely monitoring any development prior to the July 9 tariff deadline.
AUD/USD sinks towards 0.6550 as revived US tariff concerns subdue risk appetite. Encouraging US jobs data and impending trade tensions bear down on the Aussie Dollar. The pair looks to pivotal support at 0.6535–0.6545, with a potential breakdown indicating further losses.
• AUD/USD continues to fall for a second day in succession, trading around 0.6550.
• US tariff fears return with President Trump threatening letters to trade partners.
• Risk aversion worldwide rises, causing stress for risk-sensitive currencies such as the Aussie Dollar.
• More-than-anticipated US NFP numbers lowers expectations for early Fed rate reductions.
• Double Top pattern emerges at 0.6590, indicating a reversal to the downside.
• The main support at 0.6535–0.6545, the Double Top’s neckline.
• Break below 0.6535 can lead to a further decline towards 0.6510, the 38.2% Fibonacci retracement level.
The Australian Dollar is in decline as international markets become more risk-averse in anticipation of a further tightening in US trade policy. President Trump’s move to send formal letters to trading nations on unilateral tariffs has increased the prospect of a new wave of trade tensions. This has weighed heavily on sentiment for risk-sensitive assets, with Australia exposed in particular given its dependence on international trade and commodity exports.
AUD/USD DAILY PRICE CHART
SOURCE: TradingView
To the already defensive sentiment is added the robust US Nonfarm Payrolls report, which identified ongoing firmness in the US labor market. The news has reduced hopes for near-term monetary policy easing by the Federal Reserve, diverting investor attention from rate cut expectations and into global economic risks. As the July 9 deadline nears, market participants are preparing for possible disruptions that would influence not only trade flows, but also general economic stability.
TECHNICAL ANALYSIS
AUD/USD is exhibiting bearish momentum after registering a Double Top pattern around the 0.6590 level. The pair now tests the neckline support at 0.6535–0.6545, a key zone that, if broken, could validate the pattern and indicate a deeper correction. The Thursday’s lower high and the 4-hour RSI below the 50 level also confirm the bearish inclination. A confirmed breakdown below the neckline would set the pair on the path towards 0.6510, corresponding with significant Fibonacci retracement levels, and a bounce above 0.6590 would be required to reinstate the bullish thesis.
FORECAST
If bearish pressure persists and AUD/USD erodes below the 0.6535–0.6545 support range, it may validate the Double Top formation and initiate a deeper correction. The next lower target would be at 0.6510, which also coincides with the 38.2% Fibonacci retracement of the recent upmove and the June 27 swing low. A break below this level could lead to more losses down to the psychological 0.6500 level and even 0.6475 in the near future.
On the positive side, a bounce above the 0.6590 resistance—the Double Top peak—would invalidate the bearish configuration and indicate fresh bullish strength. This would set up a rise towards the 127.2% and 161.8% Fibonacci extensions at 0.6610 and 0.6640, respectively. A clean breakout above 0.6640 would entice additional buyers and drive the pair towards new highs, particularly if sentiment picks up and trade tensions are eased.
