The AUD/USD currency pair has made significant gains, approaching the 0.7240 price level, supported by a shift in risk sentiment following Axios reports indicating progress between the United States and Iran towards a potential deal aimed at resolving their ongoing conflict. At the latest update, the pair is trading at 0.7239, after reaching a daily high of 0.7277—its peak since June 2022.
This positive sentiment surrounding improved geopolitical conditions has alleviated concerns about disruptions to global energy supplies, leading to increased demand for risk-sensitive currencies like the Australian Dollar. As the geopolitical landscape stabilizes, there has been a notable decrease in safe-haven interest in the US Dollar, contributing to the AUD’s recovery.
However, the AUD/USD’s upward momentum faces some resistance due to stronger-than-anticipated private-sector employment figures from the US. The ADP Employment Change report has shown that US employers added 109,000 jobs in April, exceeding market forecasts of 99,000 and marking an improvement from a revised 61,000 increase in March. Nela Richardson, Chief Economist at ADP, indicated that job creation remains uneven across different employer sizes, with both small and large firms continuing to hire robustly, while mid-sized companies exhibit weakness. This data supports the notion of resilience within the US labor market, limiting any downward pressure on the USD.
From a technical perspective, on the four-hour chart, the AUD/USD is positioned at 0.7239 and shows a constructive bullish bias, managing to consolidate above the 20-period Simple Moving Average (SMA) at 0.7197 and the 100-period SMA at 0.7166. The pair is navigating a tight overhead range, with the Relative Strength Index (RSI) near 63 indicating solid upside momentum without an overbought condition, suggesting that further gains remain possible if nearby resistance levels are breached.
Immediate resistance is identified at 0.7242, with further resistance at 0.7251, where sellers could challenge the pair’s advance. On the downside, initial support is positioned at 0.7232, followed by 0.7229, and deeper pullbacks may target the 20-period SMA at 0.7197 and the 100-period SMA at 0.7166 to preserve the broader bullish outlook.
