The AUDUSD pair continues to lose ground within its mid-October sideways channel. Despite buyer efforts to defend the 0.65000 level, sellers are now gaining the upper hand and pushing the price toward 0.64800.
This bearish pressure shows up in the indicators. Although the Stochastic reading (%K=65, %D=52) signals potential for a bullish move, the pair keeps sliding, thus creating a clear divergence. In the meantime, the Chaikin Oscillator, while positive, isn't giving strong growth, suggesting a lack of significant buying pressure and only weak attempts to stall the decline. In this context, any bounce toward the channel's upper limit is likely to be short-lived. A sustained trend reversal is far-fetched to come into play due to the lack of strong purchasers, therefore setting the stage for another move down.
Fundamental factors reinforce the technical picture. Monetary policy uncertainty puts some extra strain on quotes. While the Reserve Bank of Australia (RBA) maintains a cautious stance, markets anticipate further rate cuts from the Federal Reserve (Fed). However, these expectations have already been factored in. Persistent risks of escalating US-China trade tensions are also bolstering demand for safe-haven assets, capping the AUD's upside given Australia's role as a key Chinese trading partner.
From a technical perspective, the immediate support to watch is 0.64350. A break below this threshold could open the path down to 0.63650. Taking into account mixed indicators and fundamentals, testing these support levels appears likely in the near term. On the upside, resistance at 0.65550 is strong, and a clear breach above it could signal a new trend reversal.
Here's the trading strategy to keep in mind:
Sell AUDUSD at current levels, or when the pair rebounds to 0.65100. Take profit 1: 0.64350. Take profit 2: 0.63650. Stop loss: 0.65550.
This forecast is relevant from October 21 till October 28, 2025.
This content is for informational purposes only and is not intended to be investing advice.
