AUD/USD Signal Today 10/07: Bearish Outlook (Chart)

(MENAFN- Daily Forex) Bearish view

• Sell the AUD/USD pair and set a take-profit at 0.6400.
• Add a stop-loss at 0.6590.
• Timeline: 1-2 days.

Bullish view

• Sell the AUD/USD pair and set a take-profit at 0.6590.
• Add a stop-loss at 0.6400.

The AUD/USD exchange rate continued to consolidate on Thursday as market participants reacted to the Fed minutes, which came a day after the Reserve Bank of Australia (RBA) delivered its interest rate decision. It was trading at 0.6538, inside an ascending range it has remained in the past few months.

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The AUD/USD pair continued to react to the latest RBA interest rate decision. It left interest rates unchanged at 3.85%, catching many investors and analysts off-guard since most of them were expecting a 0.25% cut.

The bank, led by Michele Bullock, noted that time was on its side before continuing its interest rate cuts. It hopes first to receive the quarterly inflation data later this month to determine whether it is moving towards the 2.5% target.

Analysts expect the data to show that Australia's inflation continued to move downwards. Besides, Australia did not respond to Donald Trump's tariffs. Also, the country does not buy many goods from the US.

The AUD/USD pair also reacted to the latest Federal Reserve minutes of the last meeting. Officials hinted that the bank would maintain interest rates unchanged until they confirmed that Trump's tariffs were not having a major impact on inflation.

The CME Fed Rate monitor tool estimates that the Fed will start cutting interest rates in its September meeting. Goldman Sachs analysts see three cuts this year and several more in 2026.

The view is that the existing data does not show these tariffs having a major impact on the country's inflation. Looking ahead, the only data to watch on Thursday will be the upcoming initial and continuing jobless claims numbers from the United States.

EURUSD Chart by TradingViewAUD/USD Technical Analysis

The daily chart shows that the AUD/USD exchange rate has been in a gradual rise in the past few months. It has moved from a low of 0.6345 to 0.6535, forming an ascending channel.

The pair has moved above the 50-day moving average and the 50% Fibonacci retracement level. However, the MACD and the Relative Strength Index (RSI) have formed a bearish divergence pattern.

Therefore, th pair will likely have a bearish breakdown in the coming weeks, with the next key support level to watch being the psychological point at 0.6400. A move above the year-to-date high of 0.6590 will invalidate the bearish view.

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