This week's economic calendar features several high-impact events, with markets still digesting the Reserve Bank of Australia's decision to cut the cash rate by 25 basis points to 3.85%—its second reduction this year. The move comes as inflation moderates and global risks, particularly US tariffs and trade tensions, weigh on the outlook. Attention now turns to inflation data from Canada and the UK, as well as a wave of flash PMI readings from Europe and the US, which could further influence central bank expectations. With AUDUSD maintaining a bullish technical setup, traders should stay alert for shifts in momentum triggered by these upcoming releases
Overview
This week's economic calendar features several high-impact events, with markets still digesting the Reserve Bank of Australia's decision to cut the cash rate by 25 basis points to 3.85%—its second reduction this year. The move comes as inflation moderates and global risks, particularly US tariffs and trade tensions, weigh on the outlook. Attention now turns to inflation data from Canada and the UK, as well as a wave of flash PMI readings from Europe and the US, which could further influence central bank expectations. With AUDUSD maintaining a bullish technical setup, traders should stay alert for shifts in momentum triggered by these upcoming releases.
Key Economic Events
Tuesday 07:30 am (GMT+3) – Australia: Cash Rate (AUD)
Tuesday 15:30 (GMT+3) – Canada: CPI m/m (CAD)
Wednesday 09:00 am (GMT+3) – UK: CPI y/y (GBP)
Thursday 10:15 am (GMT+3) – France: Flash Manufacturing PMI (EUR)
Thursday 10:15 am (GMT+3) – France: Flash Services PMI (EUR)
Thursday 10:30 am (GMT+3) – Germany: Flash Manufacturing PMI (EUR)
Thursday 10:30 am (GMT+3) – Germany: Flash Services PMI (EUR)
Thursday 11:30 am (GMT+3) – UK: Flash Manufacturing PMI (GBP)
Thursday 11:30 am (GMT+3) – UK: Flash Services PMI (GBP)
Thursday 15:30 (GMT+3) – USA: Unemployment Claims (USD)
Thursday 16:45 (GMT+3) – USA: Flash Manufacturing PMI (USD)
Thursday 16:45 (GMT+3) – USA: Flash Services PMI (USD)
Friday 09:00 am (GMT+3) – UK: Retail Sales (GBP)
Friday 15:30 (GMT+3) – Canada: Retail Sales m/m (CAD)
Technical Analysis
Since establishing a low at 0.59134 on April 9, AUDUSD has mounted a notable recovery, marking a bullish reversal supported by a double EMA crossover and delivering gains of over 10% from trough to peak. The pair continues to trade above both the 20- and 50-period Exponential Moving Averages, reinforcing the prevailing bullish bias.
Momentum indicators further validate the upward trajectory. The Momentum Oscillator remains firmly above the 100 threshold, suggesting sustained buying pressure, while the Relative Strength Index (RSI) holds above the 50-neutral line, indicating positive momentum and room for potential continuation of the rally.
Potential Upside Targets
Should the bulls maintain market control, traders may direct their attention toward the four potential resistance levels below:
0.65136: The initial resistance is 0.65136, representing the daily high reached on May 6.
0.66285: The second price target is identified at 0.66285, corresponding to the weekly resistance, R3, calculated using the standard Pivot Points methodology.
0.66832: The third target is established at 0.66832, aligning with the 261.8% Fibonacci Extension drawn from 0.65000 to 0.63868.
0.68663: An additional price target is estimated at 0.68663, which corresponds to the 423.6% Fibonacci Extension drawn from 0.65000 to 0.63868.
Potential Downside Targets
Should the sellers take market control, traders may consider the four potential support levels listed below:
0.62664: The first level of support is identified at 0.62664, representing 161.8% Fibonacci Extension drawn from the low point, 0.63556, to the high point, 0.65000.
0.61953: The second support level is identified at 0.61953, corresponding to the weekly support, S3, estimated using the standard Pivot Points methodology.
0.61220: The third support level is 0.61220, reflecting the 261.8% Fibonacci Extension drawn from the low point, 0.63556, to the high point, 0.65000.
0.59134: An additional downward target is observed at 0.59134, corresponding to the daily low from April 9.
Fundamentals
The Reserve Bank of Australia (RBA) lowered the cash rate to 3.85% as inflation eased into the 2–3% target range and global uncertainty intensified, especially following new US tariffs. While the labour market remains tight and employment growth steady, household consumption has softened, and the outlook for GDP growth is now more subdued. The RBA expects inflation to remain near the midpoint of its target, but warns that risks—particularly from global trade policy—could tilt the outlook in either direction. The Bank remains cautious but stands ready to respond to any material downturn, emphasizing its commitment to price stability and full employment.
Conclusion
With the RBA's latest rate cut behind us and a full slate of global economic releases ahead, markets are entering a potentially volatile stretch. Inflation data and PMI figures from key economies will be closely scrutinized for signs of shifting momentum, particularly as central banks weigh growth risks against inflation control. For AUDUSD traders, the technical landscape remains bullish, but upcoming data could be the catalyst for a decisive breakout or a reversal. Staying nimble and data-aware will be key in navigating the week ahead.