Chart alert: AUD/USD kickstarts fresh bullish impulsive sequence above 0.7090 key support

• AUD/USD driven by risk sentiment in the near-term, not fundamentals: The pair continues to behave like a high-beta risk asset, with its correlation to global equities surging to 0.95 as stagflation fears and geopolitics dominate over RBA policy signals.
• Geopolitical optimism fuels rebound: Hopes of a potential breakthrough in reopening the Strait of Hormuz triggered a risk-on move, lifting AUD/USD back above 0.7120 and aligning with gains in US equity futures.
• Technical setup supports bullish continuation: Holding above 0.7090 keeps the uptrend intact, with a break above 0.7211 opening upside toward 0.7244–0.7300; failure below support risks a pullback toward 0.7033.

Since its 17 April 2026 intraday high of 0.7222, the AUD/USD has staged a minor corrective pull-back of -1.6% within its medium-term uptrend phase in place since 30 March 2026, towards a near-term support of 0.7120 on Friday, 24 April 2026.

The recent minor consolidation seen in the price actions of the AUD/USD has been primarily driven by the fluid situation in the US-Iran war that is now entering its 9th week.

The extended ceasefire agreement without a definite date announced last week by US President Trump does not lead to a second round of peace deal resolution talks, as both sides continue to impose blockages in the Strait of Hormuz that disrupt a crucial waterway for global oil and energy flows, putting lingering fears of stagflation on the radar.

As a result, the Australian dollar has become increasingly sensitive to shifts in risk sentiment, with stagflation fears overshadowing its traditional characteristics as a “commodity currency” and hawkish guidance from the Australian central bank, RBA.

Since mid-March 2026, AUD/USD has exhibited a much closer alignment with global equities. The 20-day rolling correlation with the iShares MSCI All Country World Index (ACWI) ETF has surged to 0.95, up sharply from 0.62 on 30 March 2026 (see Fig. 1).

In today’s early Asia session on Monday, 27 April 2026, a potential breakthrough to allow the Strait of Hormuz to return to its operations may bear fruit.

Axios reported that Iran has given the US a new proposal to reopen the Strait of Hormuz and end the war, which includes putting off nuclear negotiations through Pakistan. So far, no official statements on this matter from the US White House administration.

Global markets reacted with risk-on optimism today, where an earlier gapped down of -0.3% at the start of Monday’s Asian session inflicted on the S&P 500, and Nasdaq 100 E-mini futures have been totally erased, while the S&P 500 E-mini futures is trading almost unchanged and the Nasdaq 100 E-mini futures is up marginally by 0.17% to a fresh intraday all-time high at 27,480 at this time of writing.

The AUD/USD has reacted positively in tandem with the US stock index futures, as it rose by 0.25% to trade higher at 0.7165, above Friday’s 24 April minor swing low of 0.7120.

Let’s now focus on the technical factors to determine AUD/USD’s potential short-term trajectory (1 to 3 days).

Watch the 0.7090 key short-term pivotal support on the AUD/USD. A clearance above the near-term resistance of 0.7211 (17 April 2026 minor swing high area) increases the odds of a fresh bullish impulsive up move sequence for the next intermediate resistances to come in at 0.7244/7265 and 0.7300 (also a Fibonacci extension) (see Fig. 2).

On the other hand, failure to hold and an hourly close below 0.7090 invalidates the bullish bias for another round of minor corrective decline to expose the next intermediate support at 0.7033 (close to the 20-day and 50-day moving averages).

• Today’s intraday bounce seen in the AUD/USD has taken place close to the lower boundary of its minor ascending channel in place since the 2 April 2026 low of 0.6860.
• The 20-day moving average has just flashed out a bullish crossover condition above its 50-day moving average.
• The hourly RSI momentum indicator has managed to find support on its ascending trendline at around the 50 level.