The AUD/USD pair trades near the 0.7160 region on Monday as the United States Dollar (USD) strengthens following upbeat manufacturing data, while renewed geopolitical tensions and cautious market sentiment weigh on the Australian Dollar (AUD).
The latest Institute for Supply Management (ISM) Manufacturing PMI rose to 54 in May from 52.7 in April, surpassing market expectations of 53 and signaling accelerating growth in the US manufacturing sector
Meanwhile, risk-sensitive currencies such as the Australian Dollar came under pressure after Iran reportedly halted message exchanges with the US following attacks on Lebanon. The development revived concerns about broader tensions in the Middle East, boosting demand for the US Dollar and other defensive assets. Short-term technical analysis: On the 4-hour chart, AUD/USD trades at 0.7161.
The pair maintains a neutral-to-mildly-constructive tone, trading above the 20-period Simple Moving Average (SMA) at 0.7156 but remains capped by the 100-period SMA at 0.7175. This configuration suggests consolidation within a tight range, with short-term buyers defending the recent recovery while the broader upturn remains unconfirmed. The Relative Strength Index (RSI) hovers at 50.0, hinting at balanced momentum after the latest bounce.