The Australian Dollar (AUD) saw a modest rise against the US Dollar (USD) during the Asian session on Friday, building on an overnight rebound from the lower end of its weekly range. The move came amid a weaker USD, with spot prices hovering above the mid-0.6900s, up just over 0.10% for the day. President Donald Trump's statement that the US would not resume military strikes on Iran before the November 3 midterm elections helped ease concerns over inflation and crude oil prices, contributing to the USD's decline.
However, geopolitical tensions remained a factor, with Iran's refusal to halt uranium enrichment and ongoing conflicts in Saudi Arabia potentially supporting the safe-haven USD. Additionally, the US Federal Reserve's hawkish stance limited deeper USD losses, capping the AUD/USD pair's upside potential. This caution was echoed by strategists at UOB Group, who noted that while the AUD had slipped to a low of 0.6943, a sustained decline was unlikely, with the pair expected to trade in a range between 0.6935 and 0.6975.
Technical analysis indicated a bearish near-term tone for the AUD/USD pair, with key resistance levels at 0.6983 and 0.7032, while support was found at 0.6905. The broader downswing from the 0.7237 high also weighed on the pair. Despite these challenges, UOB Group stressed that there was no clear increase in downward momentum, suggesting a period of consolidation rather than an extension of the recent pullback.