AUD/USD Price Forecast: Aussie Bulls Defy Geopolitical Limbo as RBA Hike Bets Intensify

The peace narrative is looking thinner than a paper-based derivative right now. Vice President JD Vance canceled his trip to Islamabad, Iran refused to sit at the table, and the Strait of Hormuz remains a ghost town for commercial shipping. Normally, this brand of chaos triggers a dash for dollars, but we’re seeing a different beast in 2026. Australia’s export profile is turning the AUD into a probable safe-haven proxy for $100 oil. BNY’s iFlow indicates that institutional interest hs increased, as traders look to capture the positive terms-of-trade shock provided by the Middle East conflict. We’re in a geopolitical limbo, and for now, the Aussie is comfortably perched on the high-wire.

RBA Hawks Anchor the Rally

Australia’s domestic economy is sending mixed signals that would give any trader a headache. The Westpac-Melbourne Institute Leading Index fell below trend for the first time since August 2025, printing a -0.13% growth rate. High rates are finally biting. But I don’t see the RBA blinking. Deputy Governor Andrew Hauser reiterated their commitment to anchoring inflation expectations, which essentially told the market that growth is a secondary concern. We’ve seen rate hike probabilities for next month climb to 77%. As long as the RBA stays more hawkish than the “Warsh-led” Fed, the AUD’s yield advantage remains a powerful structural floor.

Healthy Reset Above SMA

On the 0.001-brick Renko, this isn’t a market rolling over, it’s catching its breath. Price is holding well above the rising long-term MA, and the sequence of higher swing lows built off that early-April base? Still intact.

RSI cooling to 49 is actually the better outcome here. The pair was stretched after the impulse move, and now it’s not. The Z-score SMA sitting near zero backs that up, volatility has normalised, the noise has flushed out, and the structure underneath hasn’t cracked.

The pullback from 0.7220 reads as a textbook reset. Nothing more.

AUD/USD Renko Shows Constructive Swing Lows

0.001-brick Renko chart of AUD/USD displaying a bullish sequence above the 500-period SMA. Source: TradingView

Pivot Points and Support Zones

I’m closely watching the 0.7180 level. Bulls need a clean break above this immediate resistance to re-engage the run toward 0.7220. On the downside, the 0.7148 and 0.7134 band is doing the heavy lifting as primary support in this structure. Even if we see further softness, the rising 500-SMA near 0.7033 is the deeper trend support that separates a simple pullback from a meaningful breakdown. I’d stay patient here. The path of least resistance still tilts upward, but we need a breakout above 0.7180 to flip this sideways pause back into a clear continuation move.

The Verdict

• Current Trend Direction: Bullish
• Bias: Positive
• Key Support Levels: 0.6833, 0.6965, 0.70225
• Key Resistance Levels: 0.7300

Medium-Term Path: I expect AUD/USD to maintain its upward trajectory toward the 0.7225 highs, provided the 0.7115 support zone holds. The combination of a hawkish RBA and Australia’s status as an energy proxy should continue to offset the softening domestic growth data. If the Warsh-led Fed surprises with a faster balance sheet shrinkage, we may see a volatility spike, but the structural bid for the Aussie remains the dominant theme.