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• The AUD/USD outlook suggests a growing likelihood of more RBA rate cuts this year.
• The US economy added 147,000 jobs in June, compared to the forecast of 111,000.
• Investors remain uncertain over trade deals as the tariff deadline looms.

The AUD/USD outlook suggests a growing likelihood of more RBA rate cuts this year than previously anticipated, which is weighing on the Australian dollar. At the same time, the dollar gained momentum after a better-than-expected US monthly jobs report. 

A Reuters poll revealed that economists expect the Reserve Bank of Australia to lower borrowing costs a third time next week. The RBA started its easing cycle late but is gaining momentum. Inflation in Australia has eased significantly, and the economy is slowing down. Therefore, policymakers have every reason to cut interest rates. As a result, financial markets are expecting a total of five rate cuts this year, compared to the previous forecast of three.

Elsewhere, the dollar gained on Thursday after the US released an upbeat jobs report. The economy added 147,000 jobs in June, compared to the forecast of 111,000. Meanwhile, the unemployment rate came in at 4.1%, well below the forecast of 4.3%. The report eased pressure on the Fed to lower borrowing costs, boosting the dollar. 

Meanwhile, investors remain uncertain over trade deals as the tariff deadline looms. Higher tariffs might rekindle concerns about a US recession.

AUD/USD key events today

Market participants do not expect any key releases from Australia or the US. Therefore, the pair might extend Thursday’s move.

AUD/USD technical outlook: Bears set sights on the 0.6500 support

(Click on image to enlarge)

AUD/USD 4-hour chart

On the technical side, the AUD/USD price has broken below the 30-SMA after pausing near the 0.6590 key resistance. The break indicates a bearish shift in sentiment. At the same time, the RSI has broken below 50, indicating stronger bearish momentum. 

Initially, bulls had a strong lead, and the price was making higher highs and lows. Moreover, it respected the 30-SMA as support. However, bulls weakened after the price reached a new high near the 0.6590 level. The RSI formed a bearish divergence, showing fading momentum. As a result, bears gained enough strength to puncture the 30-SMA.

However, to confirm a reversal, the price must drop further below the SMA and start making lower highs and lows. In such a case, the price would likely reach the 0.6500 support level. 

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