AUD/USD Eyes Yearly Highs as Oil Prices Slump and Risk Sentiment Improves

Key Facts

1WTI crude oil saw a sharp reversal, falling from a high of $119.50 to $87.10.

2AUD/USD rose 0.4% to 0.7103, approaching key resistance levels around 0.7135-50.

3Market risk sentiment improved as optimism grew regarding a resolution to the US-Iran conflict.

The AUD/USD currency pair rose 0.4% to reach 0.7103, edging closer to its yearly highs and key resistance levels. This rally is primarily driven by a significant improvement in global risk sentiment and a sharp decline in energy costs. WTI crude oil prices experienced a dramatic reversal, falling from a peak of $119.50 to approximately $87.10 per barrel. Growing optimism regarding a potential resolution to the US-Iran conflict has further fueled the 'risk-on' mood in the markets, weighing on the US Dollar. Investors are now focusing on the 0.7135-50 resistance zone as the next major hurdle for the pair's upward momentum. The Australian Dollar continues to benefit from the RBA's hawkish stance on inflation amid a broader softening of the greenback.