• AUD/USD rose higher on Monday as the dollar slipped amid investor concerns over President Trump’s latest tariff threats against Europe.
• The dollar weakened after President Trump threatened to impose an additional 10% import tariff from February 1 on goods from Denmark, Norway, Sweden, France, Germany, the Netherlands, Finland, and the UK.
• The Australian dollar was also supported by rising expectations of higher interest rates from the RBA.
• On the data front, Australia’s Melbourne Institute Monthly Inflation Gauge rose 1% m/m in December 2025, the fastest pace since December 2023, accelerating sharply from 0.3% in the prior two months.
• The Australian dollar was up 0.17% at 0.6695, The dollar index , which measures the greenback against a basket of six major currencies, was 0.23% lower at 99.14.
• Immediate resistance is located at 0.6707(38.2%fib), any close above will push the pair towards 0.6729 (Jan 27th high).
• Support is seen at 0.6659 (38.2%fib) and break below could take the pair towards 0.6640(SMA 20)
Recommendation: Good to buy around 0.6690 with stop loss of 0.6850, and target price of 0.6750
