The AUDUSD pair was washed away by a new wave of selling pressure, declining during Thursday’s Asian session. Two primary headwinds are at play: Australia’s weak labor market report and sluggish preliminary Purchasing Managers’ Index data.
According to S&P Global, the flash Manufacturing PMI fell from April’s 51.3 to 50.3 in May. The services reading also worsened month-on-month (50.7 vs. 47.7). The composite index dropped from 50.4 to 47.8.
However, the pair’s decline could be limited by the American dollar’s weakness, driven by revived hopes for a peace agreement between the United States and Iran. Ongoing diplomatic efforts in the region may knock the greenback off its safe‑haven pedestal. The US President announced on Wednesday that negotiations are nearly complete. That said, Donald Trump also reaffirmed his intention to resume attacks in the near term if Tehran does not accept Washington’s demands.
From a technical perspective, the pair is now attempting to break below the 0.7100 support level. If breached, the path toward 0.7035 would open up.
The overall recommendation is to sell AUDUSD in case prices fall beneath the 0.7100 floor and consolidate there. Profits should be taken at 0.7035. Stop Loss could be set at 0.7140.
The volume of the open position should be calculated so that the potential loss (protected by a Stop Loss order) does not exceed 1% of your deposit. If your account balance does not allow opening a position of this size, it is better to skip this signal and wait for other trade setups that meet your low‑risk criteria.
This content is for informational purposes only and is not intended to be investing advice.
