The Australian dollar remains steady around the 0.67 resistance level as the US dollar strengthens across the board, keeping AUD/USD capped near a key technical barrier. Price action indicates a potential double top formation, signaling a shift towards range-bound, sideways-to-lower trading conditions. The Australian dollar has exhibited considerable volatility throughout the trading session, yet AUD/USD continues to approach a crucial resistance level. The 0.67 level remains unbroken, reinforcing the possibility of a double top formation that warrants close attention.
The US dollar is beginning to show signs of strengthening against various currencies simultaneously, weighing on AUD/USD. The initial response to the FOMC meeting may have been misguided. It is quite typical for markets to seize upon a narrative, pursue it with vigor, and subsequently reevaluate their stance. Markets often take a moment to reflect on the Federal Reserve’s overall stance and the expectations of participants regarding interest rate reductions.
Although an interest rate cut is anticipated in 2026, this outcome remains uncertain and does not imply that it will occur in the near future. Concerns regarding stress within the financial system are also present. Given the significant resistance level at 0.67 that has proven resilient in the past, the question arises as to whether AUD/USD is merely retracing into a broader trading range.
Many currency traders would contend that this is the standard environment for AUD/USD, and it has indeed been the case for this market for an extended period, except for the significant selloff that occurred when Donald Trump declared substantial tariffs against China in April. In summary, this has been a challenging period, characterized predominantly by lateral movement. The likelihood of a downside move appears to be increasing, with potential support identified around the 0.6550 level. The current price action suggests that AUD/USD may be nearing the upper boundary of a larger consolidation pattern.