The currency pair is experiencing a drop, nearing 0.7060 in the early hours of the European session on Friday. A poll indicated that the central bank is expected to increase the interest rate to 4.10% next week. The positive outlook for the pair remains intact, staying above the important 100-day EMA. The first downside target to watch is 0.7020, while the immediate resistance level is set at 0.7120. The AUD/USD pair is down, hovering around 0.7060 during the early European session on Friday. The pair retreats from levels near three-year highs as rising tensions in the Middle East increase safe-haven flows, strengthening the US Dollar. US President Donald Trump emphasized that preventing Iran from obtaining nuclear weapons and threatening the Middle East is “of far greater interest and importance to me” than the cost of oil.
Meanwhile, Mojtaba Khamenei, the newly appointed supreme leader of Iran, announced that the Islamic Republic intends to uphold the effective closure of the Strait of Hormuz. He mentioned that Tehran would aim to initiate more fronts in the conflict if the US and Israel persist with their attacks. On the other hand, strong expectations for an interest rate increase by the Reserve Bank of Australia next week might help lessen the Australian dollar’s downturns. A poll indicated on Friday that 23 out of 30 economists anticipate the Australian central bank will increase the Official Cash Rate to 4.10% on March 17, whereas seven economists forecast no change. The forecast shows a shift from the February survey, which anticipated rates remaining stable at 3.85%. The latest median forecast suggests that the cash rate is anticipated to reach 4.35% by the end of 2026.
In the daily chart, the near-term outlook for AUD/USD seems to show a bit of positivity as the price stays above the rising 100-day exponential moving average and is stabilizing just beneath the recent highs. Daily closes have been accumulating in the upper range of the Bollinger Bands, with the bands indicating a flattening trend. This indicates a persistent upward trend that is consistent but becoming more measured, rather than pointing to an explosive peak. The RSI has eased from previously elevated levels above 70, currently resting in the mid-50s. This suggests that although there is still positive momentum, the speed of the upward trend has slowed down after the earlier spike this month.
Immediate support is identified at 0.7020, marking the recent consolidation floor, with subsequent support at 0.6950, corresponding to the lower half of the current Bollinger envelope and recent swing lows. A more significant pullback would reveal critical support at 0.6900, followed by the 100-day EMA area near 0.6840. On the upside, initial resistance is positioned at 0.7120, the recent closing high, followed by 0.7150 and then 0.7200, where previous upper Bollinger Band extremes indicate stretched conditions.