The AUD/USD pair dropped 0.5% on Thursday, pulling back from a four-year peak as trading volume decreased throughout the afternoon. This pair is nearing the 0.7280 mark, the strongest level since June 2022, but the recent bullish momentum appears to be waning after the latest rally. The daily candlestick closed close to the day’s low.
Even with a relatively quiet domestic calendar, the Australian dollar continues to hover near a four-year high as traders anticipate more significant catalysts next week. On Tuesday, the minutes from the Reserve Bank of Australia (RBA) meeting will be scrutinized for insights on interest rate trends, while Westpac consumer confidence figures released that day may indicate whether the sharp drop of -12.5% in April has stabilized. Upcoming data on Monday regarding China’s industrial production and retail sales—expected to show year-on-year growth of 5.7% and 1.7%, respectively—remains crucial for the Australian dollar due to trade connections.
Looking at the U.S. dollar, April’s retail sales met expectations, recording a 0.5% increase month-over-month, with used auto sales slightly surpassing that at 0.7%. This suggests a cooling off from the 1.6% month-over-month rise in March. Initial jobless claims ticked up a bit to 211,000, compared to the expected 205,000. On Thursday, four Federal Reserve officials, including New York Fed President John Williams, were active in discussions, while markets now set their sights on the FOMC meeting minutes next Wednesday and preliminary S&P World Purchasing Managers’ Index (PMI) results on Thursday for indications of U.S. economic activity.
AUD/USD 5 minute chart
Technical Analysis
On the 5-minute chart, AUD/USD stands at 0.7222, lower than the opening price of 0.7258, which suggests a slight bearish intraday trend. The recent bounce sits within a broader corrective phase. The Stochastic RSI has eased towards the mid-50s and currently hovers near neutral at around 49, indicating that the previous upward momentum is fading.
For upward movement, the first resistance can be found near the day’s opening price at 0.7258—remaining above this level would suggest a stronger recovery. However, the lack of nearby support makes the pair more vulnerable to slipping, and intraday buyers are expected to emerge only at lower, untested price levels.
On the daily chart, AUD/USD is at 0.7222, still above the 50-day exponential moving average (EMA) at 0.7108 and the 200-day EMA at 0.6847. This indicates solid support for the current trend, and maintains a near-term positive bias. The Stochastic RSI is within the rising zone around 72, suggesting that bullish momentum persists, even if the recent rally continues.
On the downside, initial support appears at the 0.7108 range, with the 50-day EMA acting as the first dynamic floor. If a deeper pullback occurs, the 200-day EMA will help maintain the broader bullish outlook around 0.6847. Since resistance is absent in proximity above current levels, the prevailing sentiment remains optimistic as long as the price stays above the significant moving averages.
(The technical analysis in this story was written with the help of AI tools.)
