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).
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