AUD/USD Forecast: 0.7140 Extends Toward the 0.7144 High
- The Australian dollar trades at 0.7140, up 0.43% on the day and a few pips below the 0.7144 session high.
- The Reserve Bank held the cash rate at 4.35% on 11 August and said headline inflation is still too high, keeping a further increase on the table.
- The 0.7110 fast moving average is the level that decides the next move; losing it would end a three-week sequence of higher lows.
Fundamental Analysis: AUD/USD
The Australian side of this pair is the more hawkish one, which is unusual. The Reserve Bank of Australia left the cash rate at 4.35% on 11 August 2026 after three increases earlier in the year, and its statement was blunt: headline inflation is still too high, trimmed mean inflation remains elevated and little changed from the March quarter, and the Board does not expect inflation back at the target midpoint until late 2027. That is a central bank guarding against upside risk, not preparing to ease.
The counterweight is that the Federal Reserve has stopped sounding dovish too. The Fed left the federal funds target at 3.50% to 3.75% in July for a fifth consecutive meeting, with three officials dissenting in favour of a 25 basis point increase, and minutes released on 19 August showed officials saw a case for hiking if inflation does not cool. With US consumer prices running at 3.4% year on year in July, the dollar is not the soft leg of this pair that a 60 to 85 basis point differential might imply.
What the balance produces is a grind rather than a breakout. Australia's rate advantage is real but narrow, and both central banks are leaning the same direction, so the pair is being driven by which set of inflation data disappoints next rather than by a clear policy divergence. That argues for the current stair-step pattern continuing until one of those data prints breaks the symmetry.
Technical Analysis: AUD/USD
Price has climbed steadily from roughly 0.6960 at the start of August, and every consolidation since has resolved higher. The moving averages are stacked in textbook bullish order beneath price at 0.7110, 0.7089, 0.7063 and 0.7038, with the gaps between them widening — a sign the trend is being renewed rather than fading. The 19 August dip found buyers exactly at the 0.7110 line.
Resistance is the 0.7144 session high, then the 0.7160 area that capped the pair earlier in the month. Support runs 0.7110, then 0.7089, with the deeper shelf at 0.7063. A four-hour close below 0.7063 would break the pattern of higher lows and turn the structure sideways.
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