Risk is back with a vengeance today. I’ve watched the dollar index retreat to pre-war levels as news of potential US Iran talks in Pakistan circulates, effectively erasing the Operation Epic Fury premium. While physical crude remains tight, the currency market’s betting on a diplomatic breakthrough. AUD/USD is the primary beneficiary here. It’s the favorite proxy for global growth. We’re witnessing a massive short-covering rally. The Greenback’s bleeding out.

Jobs Data Solidifies RBA Stance

Underpinning this surge is a remarkably resilient domestic economy. ABS data shows the Australian labor market remains tight. Unemployment held steady at 4.3% in March. I believe this labor strength is the RBA’s get-out-of-jail-free card. It allows them to keep the cash rate at 4.10% or higher, in order to combat oil-driven inflation. The yield advantage is only just being priced in.

Labor Market Resilience

Multi-Year Highs for Aussie

Powerful move higher for AUD/USD. Looking at the weekly timeframe, the AUD/USD pair successfully navigated a brutal stress test and is making multi-year highs. It is firmly above both short long long Supertrends.. Bears have nowhere left to hide. Institutional algorithms are defending the recovery from the 0.5509 lows. Momentum points upward. We’re targeting the 0.73 ceiling next.

Weekly Squeeze Pivots to Highs

Weekly candlestick chart of AUD/USD holding above both Supertrend floors. Source: TradingView

Daily 21-EMA acts as Dynamic Support

The daily chart reveals a V-shaped recovery directly off the 0.6833 structural pivot. It was aggressive. So aggressive it forced the entire price complex back above the 21-EMA. The road to monthly highs. The RSI has surged past 60. We aren’t even overbought yet. I love the technical symmetry. The market absorbed the geopolitical shock, found its footing, and is now punishing the late sellers.

Breakthrough Multi-Year Highs

Daily AUD/USD candlestick chart showing V-shaped recovery above the 21-period EMA. Source: TradingView

Renko Algorithmic Breakout

The 0.001-brick Renko chart continues to print a clean run of green continuation bricks, underscoring firm upside control from the lows. That move has carried price through the 500 SMA, a level that had previously acted as a ceiling on rallies, which strengthens the near-term bullish case. The Z-Score SMA does look somewhat stretched in the short term, so a brief pause or shallow pullback wouldn’t be surprising, but the broader intraday structure still looks constructive. With the Supertrend holding green, momentum remains intact and the path of least resistance still points higher for intraday swing traders.

Renko Breakout

0.001-brick traditional Renko chart of AUD/USD showing sequence of green bricks above 500-SMA. Source: TradingView

The Verdict

Current Trend Direction: Bullish

Bias: Positive

Key Support Levels: 0.6725, 0.6833, 0.6852

Key Resistance Levels: 0.71875

Medium Term Path: I expect AUD/USD to remain biased higher, supported by short-covering and an improvement in overall risk sentiment. That bullish path stays intact as long as the daily 21-EMA continues to catch profit-taking pullbacks and hold the structure together. A sustained break above 0.71875 would strengthen the case for a move toward 0.7300. Keep a close eye on headlines out of Islamabad, as any diplomatic progress could remain a key catalyst for direction.