CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 77% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Create Account
☰
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 77% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Create Account
✖

AUD/USD V-Shape Recovery Stalls Ahead of December High

Article By: ,  Strategist
Friday 6:20 PM

Australian Dollar Outlook: AUD/USD

The V-shape recovery in AUD/USD seems to have stalled ahead of the December high (0.6515) as it struggles to retain the advance from the weekly low (0.6344).

AUD/USD V-Shape Recovery Stalls Ahead of December High

AUD/USD is little changed from the start of the week after registering a fresh yearly high (0.6439), and the exchange rate may consolidate over the remainder of the month as it appears to be tracking the flattening slope in the 50-Day SMA (0.6299).

Join David Song for the Weekly Fundamental Market Outlook webinar.

David provides a market overview and takes questions in real-time. Register Here

 

Nevertheless, data prints coming out of Australia may sway AUD/USD as the Reserve Bank of Australia (RBA) pledges to ‘rely upon the data and the evolving assessment of risks to guide its decisions,’ and the exchange rate may face increased volatility ahead of the next rate decision on May 20 as the Consumer Price Index (CPI) is anticipated to show sticky inflation.

Australia Economic Calendar

Australia’s CPI is expected to increase 0.8% in the first quarter of 2025 following the 0.2% rise during the previous period, and signs of persistent price growth may generate a bullish reaction in Australia Dollar as it encourages the RBA to further combat inflation.

At the same time, a weaker-than-expected CPI print may push the RBA to further unwind its restrictive policy, and indications of slowing price growth may drag on the Australian Dollar as Governor Michele Bullock and Co. acknowledge that ‘the continued decline in underlying inflation is welcome.’

With that said, the V-shape recovery in AUD/USD may unravel as it appears to be pulling back ahead of the December high (0.6515), but the exchange rate may continue to trade to fresh yearly highs should it defend the weekly low (0.6344).

AUD/USD Price Chart – Daily

Chart Prepared by David Song, Senior Strategist; AUD/USD on TradingView

  • AUD/USD seems to be reversing ahead of the December high (0.6515) as it struggles to close back above 0.6410 (50% Fibonacci extension), and failure to defend the weekly low (0.6344) may push the exchange rate towards 0.6240 (61.8% Fibonacci extension).
  • A break/close below the 0.6130 (23.6% Fibonacci retracement) to 0.6140 (23.6% Fibonacci extension) brings the 0.5990 (78.6% Fibonacci extension) to 0.6020 (38.2% Fibonacci extension) zone on the radar, with the next area of interest coming in around 0.5930 (61.8% Fibonacci extension).
  • At the same time, a breach above the weekly high (0.6439) may lead to a test of the December high (0.6515), with a break/close above the 0.6510 (38.2% Fibonacci retracement) to 0.6520 (38.2% Fibonacci extension) region opening up 0.6590 (38.2% Fibonacci extension).

Additional Market Outlooks

GBP/USD Rebound Vulnerable to Weak UK Retail Sales Report

Gold Price Coils Above 50-Day SMA

Euro Forecast: EUR/USD Reverses Ahead of November 2021 High

Canadian Dollar Forecast: USD/CAD Cracks November Low Ahead of Election

--- Written by David Song, Senior Strategist

Follow on X at @DavidJSong

StoneX Europe Ltd may make third party material available on this website which may contain information included but not limited to the conditions of financial markets. The material is for information purposes only and does not contain, and should not be construed as containing, investment advice and/or investment recommendation and/or an investment research and/or an offer of or solicitation for any transactions in financial instruments; any decision to enter into a specific transaction shall be made by the client following an assessment by him/her of their situation.

StoneX Europe Ltd makes no representation or warranty and assumes no liability as to the accuracy or completeness of the information provided, nor any loss arising from any investment based on a recommendation, forecast or other information supplied. You should always seek independent advice as to your suitability to speculate in any related markets and your ability to assume the associated risks, if you are at all unsure. We are not under any obligation to update any such material. Any opinion made may be personal to the author and may not reflect the opinion of StoneX Europe Ltd.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 67.6% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Please ensure you fully understand the risks involved by reading our full risk warning.

FOREX.com is a trading name of StoneX Europe Limited, and FOREX.com/ie is a domain operated by StoneX Europe Ltd, a member of StoneX Group Inc. StoneX Europe Ltd, is a Cyprus Investment Firm (CIF) company registered to the Department of Registrar of Companies and Official Receiver with a Registration Number HE409708, and authorized and regulated by the Cyprus Securities & Exchange Commission (CySEC) under license number 400/21. StoneX Europe is a Member of the Investor Compensation Fund (ICF) and has its registered address at Nikokreontos 2, 5th Floor, 1066 Nicosia, Cyprus.

FOREX.com is a trademark of StoneX Europe Ltd, a member of StoneX Group Inc.

This website uses cookies to provide you with the very best experience and to know you better. By visiting our website with your browser set to allow cookies, you consent to our use of cookies as described in our Privacy Policy.

Through passporting, StoneX Europe is allowed to provide its services and products on a cross-border basis to the following European Economic Area ("EEA") states: Austria, Bulgaria, Croatia, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Liechtenstein, Lithuania, Luxembourg, Malta, Netherlands, Norway, Poland, Portugal, Romania, Slovakia, Slovenia, Spain, Sweden.

StoneX Europe Ltd products, services and information are not intended for residents other than the ones stated above.

StoneX Europe Ltd may make third party material available on this website which may contain information included but not limited to the conditions of financial markets. The material is for information purposes only and does not contain, and should not be construed as containing, investment advice and/or investment recommendation and/or an investment research and/or an offer of or solicitation for any transactions in financial instruments; any decision to enter into a specific transaction shall be made by the client following an assessment by him/her of their situation. StoneX Europe Ltd makes no representation or warranty and assumes no liability as to the accuracy or completeness of the information provided, nor any loss arising from any investment based on a recommendation, forecast or other information supplied. You should always seek independent advice as to your suitability to speculate in any related markets and your ability to assume the associated risks, if you are at all unsure. We are not under any obligation to update any such material. Any opinion made may be personal to the author and may not reflect the opinion of StoneX Europe Ltd.

© FOREX.COM 2025