Australian Dollar steadies ahead of Australian employment data

• AUD/USD rebounds toward 0.7000 as the DXY falls near 101.10
• Trump’s warning of potential US strikes on Iranian infrastructure might limit the Aussie’s recovery.
• Australia’s June Employment report is expected to show a 15K job increase.

AUD/USD trades near 0.7000 on Wednesday, recovering from an intraday pullback but remaining marginally lower on the day. The pair briefly fell toward 0.6985 before rebounding, while the US Dollar Index (DXY) slipped toward 101.10, helping the Australian Dollar regain some ground.

Geopolitical risks remain elevated after United States (US) President Donald Trump warned that the United States would strike Iranian bridges and power plants if Iran attacks another ship in the Strait of Hormuz.

The comments increased concerns about a broader conflict and further disruption to global energy supplies. Higher geopolitical uncertainty may support safe-haven demand for the US Dollar, potentially limiting AUD/USD gains, and rising Oil and Gold prices indicate that markets remain cautious.

Investors now await Australia’s June labor market report. Employment is expected to rise by 15K, slowing sharply from May’s 40.3K increase. The Unemployment Rate is forecast to remain unchanged at 4.4%, while the Participation Rate is expected to hold at 66.7%. The report will also provide details on full-time and part-time employment after increases of 5.2K and 35.2K, respectively, in May.

Short-term technical analysis:

On the 4-hour chart, AUD/USD trades at 0.6993, holding between the 100-period Simple Moving Average (SMA) support at 0.6953 and the 20-period SMA resistance at 0.6998, which leaves the pair in a neutral but slightly capped near-term stance. Price is struggling to decisively clear the nearby cluster of resistance defined by the 20-period SMA at 0.6998 and the horizontal barrier at 0.6999, while the Relative Strength Index (RSI) around 49 hints at consolidative momentum rather than a strong directional push.

On the downside, initial support appears at 0.6989 ahead of the lower horizontal floor at 0.6981, with stronger structural demand emerging from the 100-period SMA near 0.6953. On the topside, a sustained move above the 20-period SMA at 0.6998 and the 0.6999 horizontal cap would open the way toward the next resistance at 0.7005, where sellers could attempt to reassert control.

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