AUDUSD Drops to Four-Month Low Amid Weak GDP Data and RBA Rate Cut Bets

The Australian dollar fell 1% to hit a four-month low on Wednesday following weaker-than-expected Q3 GDP figures, which dampened the Reserve Bank of Australia’s (RBA) hawkish tone.

Economic growth in the third quarter came in significantly below forecasts and well under the RBA’s projections, amplifying expectations for a rate cut. Market bets on policy easing nearly doubled after the release of the disappointing data.

Adding to the pressure on the Aussie dollar are ongoing political instability in Asia and persistent concerns over economic growth.

The technical outlook on the daily chart remains bearish, with negative momentum strengthening as the price moves below the falling and diverging Tenkan-sen and Kijun-sen lines.

The pair is firmly in the red for the third consecutive month, reinforcing a negative outlook, though some profit-taking, likely limited, may occur in the near term.

Bears are targeting key support at the psychological 0.6400 level, with further downside seen at 0.6362 (April 19 low) and 0.6348 (2024 low posted on August 5).

Immediate resistance is seen at the former lows around 0.6440, followed by the broken 76.4% Fibonacci retracement level, strengthened by the falling 10-day moving average at 0.6489 and the November 29 lower top at 0.6528.

Res: 0.6537; 0.6575; 0.6600; 0.6637
Sup: 0.6400; 0.6362; 0.6348; 0.6270