AUD/USD trades below the 0.6300 zone after retreating from earlier highs.
Tariff-driven optimism fades as the Trump administration unveils complex reciprocal trade measures.
Resistance aligns near 0.6400 while the technical backdrop remains mixed.
On Wednesday's American session, the Australian Dollar pulled back after a brief spike to multi-day highs, with the AUD/USD pair slipping back under the 0.6300 threshold. The move followed a temporary boost in risk sentiment triggered by US President Donald Trump's tariff announcement, which was perceived as milder than feared. Technically, momentum remains conflicted as oscillators show divergence while the pair consolidates near familiar territory.
Markets initially welcomed the White House’s decision to impose a 10% blanket tariff on all imports and a 25% duty on automobiles, with implementation scheduled for April. The perception of a controlled rollout fueled a brief rebound in risk assets. However, once details revealed a layered, country-specific approach to tariffs—adding complexity to trade flows—investors turned cautious once again.
Meanwhile, the Reserve Bank of Australia (RBA) maintained its key rate at 4.10% earlier in the week. The RBA dropped its earlier signal about further easing but acknowledged persistent risks in both inflation and growth. RBA Governor Michele Bullock stressed caution and ruled out discussions of a rate cut for now, though markets still price in a high probability of easing at the May meeting.
Technical outlook: Mixed signals cap gains
The technical landscape is showing indecision. The Moving Average Convergence Divergence (MACD) is printing fresh red bars, suggesting bearish momentum. The Relative Strength Index (RSI), however, is rising and sits near the midpoint, indicating consolidation rather than clear trend direction.
On the upside, resistance levels are noted at 0.62978, 0.6304, and the psychological 0.6400 mark. The 20-, 100-, and 200-day Simple Moving Averages all lean bearish, reinforcing the idea that upside attempts may be capped unless a clear catalyst emerges.
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