Australian Dollar slides as AI sell-off rattles Wall Street

• AUD/USD trades at 0.6960, down 0.11% on Thursday.
• OpenAI revenue shortfall fuels losses across major AI stocks.
• Waller leaves further Fed hikes on the table but signals flexibility.

The Aussie Dollar dives 0.11% on Thursday as the US Dollar retreats from monthly highs, with safe-haven flows shifting from the Greenback to the Japanese Yen and the Swiss Franc amid losses on Wall Street and US yields. The AUD/USD trades at 0.6960 at the time of writing.

AUD/USD lags its G8 peers despite a softer Dollar and falling Treasury yields

Market mood turned downbeat as tech stocks fell after OpenAI's annual revenue came in $20 billion below expectations, dragging major AI stocks lower. The US Dollar weakened on the report as well, while the Aussie Dollar trimmed some of its previous losses, though it was the weakest currency of the G8 FX space.

The US Dollar Index (DXY), which tracks the buck’s performance against six currencies, drifted lower by 0.13% to 102.11, undermined by a decline in US Treasury yields.

Two Federal Reserve officials grabbed the headlines, alongside geopolitics. Fed Governor Christopher Waller supports further rate hikes but warned that they don’t have to be “consecutive,” cementing the case for the Fed holding rates in October.

St. Louis Fed Alberto Musalem, a voter in 2028, said that inflation is high and that a strong jobs market provides clues to the central bank to focus on curbing persistently high inflation above its 2% goal.

In the calendar, US Initial Jobless Claims fell to 197K in the week ending October 3, below forecasts for a jump of 200K, indicating that the labor market is in a “low-hire, low-fire” environment.

In Australia, Friday’s economic docket is absent, but eyes will be on next week’s economic docket. On October 12, the Reserve Bank of Australia (RBA) releases its last meeting minutes. Two days after that, employment data would dictate the Aussie Dollar’s direction.

In the US, the schedule features the University of Michigan Consumer Sentiment, followed by next week’s inflation data on the consumer and producer sides, Retail Sales, and further Fed speaking.

AUD/USD Price Forecast: Technical outlook

In the daily chart, AUD/USD trades at 0.6960, keeping a bearish near-term tone as spot holds beneath the cluster of the 50/100/200-day simple moving averages (SMA) grouped around 0.7089 and the former support trend line now acting as resistance near 0.7067. The Relative Strength Index (14) at 34.70 hovers just above oversold territory, suggesting downside momentum is still dominant but may be slowing as price tests the lower end of the recent range.

On the topside, initial resistance is seen at the upward trend-line barrier around 0.7067, followed closely by the triple SMA cap near 0.7089, while a stronger ceiling emerges at the horizontal level at 0.7198, ahead of more distant trend-line resistances at 0.7415, 0.8826 and 0.9732. On the downside, immediate support aligns with the rising trend line around 0.6912, with a deeper structural floor at the prior downward trend-line break near 0.6365, where buyers would be expected to show more robust interest if the current slide extends.

(The technical analysis of this story was written with the help of an AI tool. Know more.)