Break of 0.662 greenlights AUDUSD run to September high

The AUDUSD pair, having rebounded from its monthly low last week, saw its upward momentum stall at the 0.662 resistance. This level is currently preventing a return to the September high of 0.67. An inverse head and shoulders pattern has formed on the four-hour (H4) chart, with the neckline coinciding with 0.662. A sustained consolidation above this threshold would provide strong incentive for the bullish move to gain traction.

The technical setup paves the way for the Australian dollar to get stronger. The RSI indicator is gradually rising, though it remains well below the overbought zone. Support at 0.658, reinforced by the 200-period moving average, only spurs buying interest. In line with the daily chart, the pair has been trending upward, with lows occurring in April, August, and September. This keeps any big drop in AUDUSD far away from happening.

Meanwhile, the Aussie is supported by the Reserve Bank of Australia's (RBA) tight monetary stance. Last week, the regulator held its key rate steady, saying that inflation is still a problem. Yesterday's TD Securities data corroborated this view, showing a preliminary monthly price hike of 0.4% in September, which pushed the annual rate up from 2.8% to 3.0%. Consequently, traders are now predicting only two rate cuts to come into play—one in November and another in early 2026—after which the current monetary easing cycle is likely to conclude.

Recently, the US government shutdown has suspended the release of official economic data, prompting market participants to rely on private indicators that offer a less-than-optimistic outlook. For instance, chief economist at Moody's Analytics Mark Zandi estimated only 60,000 jobs were added in September. He also noted that this meager growth was mostly seen within the healthcare and education sectors, while small businesses are bearing the brunt of import tariffs.

The following trading strategy may be suggested:

Buy AUDUSD if it consolidates above 0.662. Take profit: 0.668. Stop loss: 0.658.