Published: 23 January 2026,06:37
Daily Market Analysis New
*AUDUSD hit 0.6852, its highest since Nov 2024, after unemployment fell to 4.1% and jobs surged +65.2k, reinforcing a hawkish tilt for the RBA.
*Robust Australian data contrasts with a dovish-leaning Fed and a still-weak JPY, allowing the Aussie to capitalize on broad USD and funding-currency softness.
*A sustained hold above this level signals a structural shift higher, with 0.6900 in sight ahead of the February RBA meeting, barring a sharp risk-off turn.
Market Summary:
The Australian dollar has emerged as a standout performer among G10 currencies, with the AUDUSD pair reaching its highest level since November 2024 at 0.6852. This strength contrasts with simultaneous headwinds facing both the U.S. dollar and the Euro, driven largely by idiosyncratic domestic catalysts and a favorable policy divergence narrative.
The primary catalyst is a significantly stronger-than-expected domestic labor market report. The Australian unemployment rate improved to 4.1% from 4.3%, while employment surged by 65.2 thousand jobs, dramatically reversing a prior decline. This data reinforces the Reserve Bank of Australia’s stated data-dependent approach and has fueled market speculation of a more hawkish policy bias relative to peers.
This domestic strength is amplified by external weaknesses. The U.S. dollar remains under pressure from both political uncertainty surrounding the Greenland situation and a market leaning toward a dovish Fed pivot. Concurrently, the Japanese Yen continues to struggle despite BoJ policy normalization, weighed down by its entrenched status as a funding currency. The Aussie is effectively capitalizing on this dual-lane weakness.
The AUD’s momentum is likely to extend into the RBA’s first policy decision of the year in early February. A sustained hold above 0.6800 would confirm a bullish structural shift. The currency’s trajectory will depend on the RBA’s tone—any reaffirmation of its data-dependent, patient stance could support further gains, especially if global risk sentiment stabilizes and commodity prices remain resilient. The pair is well-positioned for a test of the 0.6900 level barring a sharp deterioration in the global risk environment.
Technical Analysis
The AUDUSD pair has sustained strong bullish momentum following its decisive breakout from a prior consolidation range, rallying nearly 2% to establish a new uptrend phase. While the overall structure remains decidedly bullish, the pace and extent of the advance have created conditions conducive to a near-term technical pullback. Such a retracement would likely target the Fair Value Gaps (FVGs) or imbalance zones created during the rapid ascent. The ability of the pair to find support and stabilize above these levels would serve to confirm the underlying bullish bias and potentially offer a more favorable risk-adjusted entry point.
Momentum indicators affirm the strength of the prevailing trend but also highlight overextended conditions. The Relative Strength Index continues to hover within overbought territory, while the Moving Average Convergence Divergence histogram extends higher. This configuration suggests that while bullish momentum remains solid, the market is increasingly susceptible to a corrective pause to alleviate overbought readings.
The technical outlook is bullish but entering a phase where a retracement is increasingly probable. The primary trend is upward, and any pullback should be viewed as corrective within that trend, provided key support near the 0.6780 breakout level and FVG zones hold. A successful defense of these supports would reaffirm buyer commitment and set the stage for the next leg higher. The bullish scenario would be invalidated by a sustained break below the main breakout support, which would instead signal a failed breakout. Traders are advised to monitor price action in these support zones for confirmation of continued bullish structure.
Resistance Levels: 0.6910, 0.7010
Support Levels: 0.6755, 0.6670
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