31 October 2025,06:44
Daily Market Analysis New
31 October 2025, 06:44
Key Takeaways:
*The Australian dollar remains resilient despite a stronger U.S. dollar, supported by robust domestic fundamentals.
*Australia’s Q3 CPI surged to 3.2% YoY, reinforcing expectations that the RBA will keep rates unchanged at its November 5 meeting.
*The U.S.-China trade truce has lifted sentiment toward China-linked assets, underpinning further upside potential for the AUD.
Market Summary:
Gold pThe Australian dollar is trading near 0.6550 against the U.S. dollar, finding relative strength despite a broadly stronger greenback. The U.S. dollar’s momentum is fueled by a hawkish pivot from the Federal Reserve and a mitigation of trade tensions following the recent meeting between former President Trump and President Xi.
The Aussie’s resilience stems from domestic inflationary pressures and optimism regarding its key trading partner, China. Australia’s headline Consumer Price Index accelerated to 3.2% year-on-year in the third quarter, a print that effectively rules out any chance of a rate cut from the Reserve Bank of Australia at its November meeting. Concurrently, the market is anticipating a potential pro-growth spillover for the Australian economy after China and the U.S. reached a trade truce, bolstering the outlook for the Chinese-proxy currency.
As a result, the RBA is universally expected to hold its cash rate steady at its Nov. 5 decision. Should the current macroeconomic landscape persist, the Australian dollar is poised to continue grinding higher against its G-10 peers, with markets pricing in a more hawkish stance from the RBA relative to other central banks.
The Australian dollar has come under heavy selling pressure, surrendering its earlier gains after breaking down from an ascending triangle formation — a development that signals a shift in near-term momentum. The move has brought the AUD/USD pair toward a critical support zone around 0.6520, where a decisive break below would confirm a full structural breakdown and reinforce a bearish bias for the pair.
Technical indicators corroborate the weakening trend. The Relative Strength Index (RSI) continues to retreat after slipping out of overbought territory, highlighting fading buying interest, while the Moving Average Convergence Divergence (MACD) has formed a bearish crossover and is edging toward the zero line. These signals collectively indicate that the prior bullish momentum has dissipated, leaving downside risks dominant in the short term.
Resistance Levels: 0.6588, 0.6621
Support Levels: 0.6510, 0.6468
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