Australian Dollar Forecast: AUD/USD Uptrend Break Faces First Major Test

Australian Technical Forecast: AUD/USD Weekly Trade Levels

• AUD/USD has broken below its multi-month uptrend after falling more than 5% from the yearly highs.
• Weekly momentum has slipped below 50 for the first time since November, reinforcing the shift in trend pressure.
• Aussie is attempting to stabilize above major support with the July opening range taking shape just above- breakout pending.
• A break below support would signal continuation of the broader decline while a rebound above former support would suggest potential false break scenario.
• Event risk on tap: FOMC minutest today & CPI, retail sales next week.
• Resistance 6943, 7023 (key), 7116/20- Support 6877/50 (key), ~6796, 6717/57

AUD/USD has broken below its multi-month uptrend after a sharp decline from the yearly highs, shifting the technical focus toward the July opening range and a major support zone just below. Weekly momentum has turned over, and the question now is whether Aussie can stabilize above support and carve out a near-term low, or if the breakdown opens the door to another leg lower. Battle lines drawn on the AUD/USD weekly technical chart.

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Australian Dollar Price Chart – AUD/USD Weekly

Chart Prepared by Michael Boutros, Sr. Technical Strategist; AUD/USD on TradingView

Technical Outlook: In last month’s Australian Dollar Forecast we highlighted the inflection risk as AUD/USD approached multi-month uptrend support while noting that, “rallies would need to be limited to 7116 IF price is heading lower on this stretch with a close below parallel support needed to fuel the next leg lower.” Aussie registered an intraweek high at 7089 the following week before breaking sharply lower with the decline extending more than 5.6% off the yearly highs into the close of June. The decline marks a break of the multi-month uptrend and pushes weekly momentum (RSI) below 50 for the first time since November.

AUD/USD rebounded off support last week at the March close low and the 1.618% extension of the May decline at 6877/80. The July opening range is being carved just above this zone, and the focus is on a potential breakout in the days ahead to offer guidance here.

Initial weekly resistance is eyed with the 2024 swing high at 6943 and is backed by the 38.2% retracement of the May selloff at 7023. Note that this level converges on former uptrend support over the next few weeks and a breach / close above this slope would suggest a more significant low is in place and a larger reversal is underway. Subsequent resistance objectives eyed at the February high close and the 61.8% retracement at 7116/20.

A break below this key pivot zone would threaten another bout of accelerated losses towards the 52-week moving average near ~6796 and 6717/57- a region defined by the 2025 close high and the 38.2% retracement of the broader 2025 advance. Look for a larger reaction there IF reached.

Bottom line: AUD/USD has broken the November uptrend with the bears now facing the first major test of technical support. The weekly & monthly opening ranges are taking shape just above and the focus is on a breakout in the days ahead. From a trading standpoint, rallies would need to be limited to 7023 IF price is heading lower on this stretch with a close below 6877 needed to fuel the next major leg of the decline.

Keep in mind we get the release of FOMC minutest within the hour with key inflation data on tap next week. Stay nimble into the releases and watch the weekly closes for guidance. Review my latest Australian Dollar Short-term Outlook for a closer look at the near-term AUD/USD technical trade levels.

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--- Written by Michael Boutros, Senior Technical Strategist

Follow Michael on X @MBForex