AUD/USD, NZD/USD, and USD/JPY Analysis: RBA Cuts, Fed Dovish Signals, and Key Chart Patterns

AUD/USD holds steady despite RBA’s latest rate cut, NZD/USD extends gains on a weaker USD, while USD/JPY remains range-bound with downside risks.

AUD/USD – RBA Easing Meets USD Weakness

The Australian Dollar is trading near resistance after recovering in the previous session. Australia’s Q2 Wage Price Index rose 0.8% QoQ, in line with forecasts but slightly softer than the prior 0.9%. Annual growth stood at 3.4%, indicating steady wage gains but moderating momentum.

The Reserve Bank of Australia delivered its third rate cut of 2025, lowering the cash rate by 25 bps to 3.6%. Governor Michele Bullock emphasized the need to support price stability as inflation eases and the labor market cools. While the central bank kept a meeting-by-meeting approach, the bias remains toward further easing if conditions require.

Lower interest rates have reduced the AUD’s yield advantage, though sentiment improved after US-China tariff tensions eased, supporting Australia’s export outlook.

US Dollar Drivers – Fed Cut Bets and Trade Truce

The US Dollar remains under pressure after July CPI data. Headline CPI slowed to 2.7% YoY, just below expectations, while core CPI rose 3.1%, slightly above consensus. This mix has fueled market confidence in a September Fed rate cut, with odds near 94%, and expectations for multiple cuts this year.

Dovish remarks from Fed officials, including Governor Bowman, pointed to labor market weakness outweighing inflation concerns. Meanwhile, a 90-day delay in new US tariffs on China lifted risk sentiment—benefiting the AUD due to Australia’s strong trade links with China.

AUD/USD Technical Outlook – Bullish Formation in Play

On the 4-hour chart, AUD/USD is rebounding from 0.6440, the support of an ascending broadening wedge. The pair’s break above 0.6530 and the presence of an inverted head and shoulders pattern suggest a move toward 0.6650, with a further push toward 0.6720 possible if resistance breaks.

NZD/USD Technical Outlook – Upside Momentum Building

NZD/USD remains bullish above 0.5870, supported by USD weakness. The 4-hour chart points to an upside target near 0.6140, with the structure showing an inverted head and shoulders formation that supports continuation of the upward move.

USD/JPY Technical Outlook – Range with Downside Risks

USD/JPY continues to trade between 140.00 and 151.00. After peaking at 151, the pair has formed an inverted head and shoulders pattern below 148.30. A break under 146.50 would signal a drop toward 142.00.

The presence of a head and shoulders pattern at the 151 resistance level adds short-term downside pressure. A decisive move outside the 140–151 range is needed for the next major trend shift.

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Yasher Rizwan