AUD/USD Price Analysis – March 20, 2025
Daily Price Outlook
During the European trading session, the AUD/USD currency pair experienced strong bearish pressure, trading near the 0.6285 level as the Australian Dollar weakened against the US Dollar. This decline was largely attributed to disappointing domestic employment data and the continued strength of the US Dollar.
Australia's February Employment Report Shows Sharp Job Losses, Weighing on AUD
On the data front, the Australia's employment report for February revealed a sharp drop in jobs, with the Employment Change showing a loss of 52.8K jobs, compared to the expected 30.0K increase.
This was a stark contrast to the 30.5K rise reported in January (revised from 44K), highlighting a concerning slowdown in the labor market.
The Australian Unemployment Rate held steady at 4.1%, in line with market expectations, but the weaker-than-expected job growth weighed heavily on market sentiment, driving the AUD lower.
US Dollar Strengthened by Hawkish Fed Remarks and Geopolitical Tensions Weighing on AUD/USD
Meanwhile, the US dollar found strength from hawkish remarks made by Federal Reserve Chair Jerome Powell, who emphasized that the labor market remains strong and inflation is moving closer to the Fed's target, though it remains elevated. This reaffirmed expectations of further tightening, which helped maintain the USD's bullish momentum.
On the geopolitical front, global trade tensions also contributed to the market's cautious tone. Former US President Donald Trump’s ongoing tariff threats, including reciprocal tariffs and plans to impose fees on Chinese-linked vessels, have raised concerns over potential disruptions to global trade.
Moreover, Trump's ongoing trade disputes with China are creating further uncertainty in the markets, weighing on the Aussie Dollar.
In addition, the temporary agreement between President Trump and Russian President Vladimir Putin to pause strikes targeting energy infrastructure in Ukraine failed to quell broader concerns over the conflict, further adding to the risk-averse sentiment in the markets. These geopolitical factors further pressured the AUD/USD pair, limiting any potential upside.
AUD/USD – Technical Analysis
The Australian dollar (AUD/USD) is trading at $0.6317, up 0.03%, as it attempts to recover from recent declines. However, the pair remains below the key pivot level of $0.6332, suggesting that bearish pressure persists.
The 50-day Exponential Moving Average (EMA) at $0.6347 is acting as a dynamic resistance level, keeping the pair in a downward trajectory.
If AUD/USD fails to break above this level, it could face renewed selling pressure, with immediate support at $0.6298. A break below this level could open the door for further losses toward $0.6277 and $0.6258.
On the upside, resistance at $0.6363 remains a key hurdle for bulls. If AUD/USD manages to break above this level, further gains toward $0.6390 and $0.6415 could follow. However, with the broader trend favoring the U.S. dollar due to Federal Reserve policy expectations, any upside moves may be short-lived.
A break below $0.6332 is likely to reinforce a bearish trend, with a downside target at $0.6298. Traders should watch for a break above $0.6363 to confirm a potential shift in momentum.
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