May Seasonality and RBA Hike Bets Fuel Aussie Bulls

Well what a month April was for AUD/USD. It was the best month it had in over 3 years actually, producing a return upwards of 4.25%. Some of that came from a BOJ intervention yesterday. Another portion of the return could be attributed to the global equity rally that ignored all the geopolitical rhetoric and war that was happening in our news feeds.

The next thing we need to look forward to is the RBA’s rate decision. There’s an 85% probability of a hike to 4.1%. The central bank has to move inline with inflationary pressures. And as always this will be at the expense of the household that’s already grappling with high food and energy prices.

Nonetheless, the increase in rates will bode well for the carry trade, propelling the Aussie to even higher levels in the short to medium term.

AUD/USD is up over 1% for the last 5 days and flat over the last 24 hours.

AUD/USD holds near 0.72 after a Sharp Late Week Rebound

AUD/USD line chart from April 27 to May 1, 2026

Source: TradingView

May Seasonality Gives AUD/USD a Bullish Tailwind

When we look at AUD/USD’s seasonality over the last 10 years, May isn’t the best positive month, but it’s in the top 5. In May there have been 6 positive months and 4 negative months from 2016-2025 inclusive. The average rate of return being 0.31%. So when we look at seasonality there;s a 60% chance that AUD/USD will produce a positive return. The average rate of that return is 0.31%. When you look at what’s been happening geopolitically. Some may say that the odds would not be in the Aussie’s favor for May.

I would tend to disagree.

AUD/USD Seasonality Shows May Holding a Modest Positive Average Return

AUD/USD monthly seasonality heat map from 2016 to 2026 showing monthly returns, yearly returns, average monthly performance, and rise/fall counts.

Source: TradingView

Renko Breakout Puts AUD/USD Bulls in Control Above 0.7115

AUD/USD is starting off May and ending the week on a strong note. The FX Pair is testing the 0.72 price level, where over several weeks AUD/USD has been rangebound between 0.72215 and 0.71150. The Supertrend indicator flipped green some hours ago to introduce the leg higher. The momentum indicators are also reflecting that there is some room for AUD/USD to move higher with the RSI above 60 and the Z-Score SMA heading towards its top of the range around 2 as well. The FX Pair is exerting a truly bullish structure on the Renko.

AUD/USD 0.001-Brick Renko Shows Demand Pressing Toward 0.72 as Momentum Strengthens

AUD/USD Renko with 0.001 Brick Size

Source: TradingView

The Verdict

Current Trend Direction: Bullish

Bias: Positive

Support Levels: 0.6833, 0.70140

Resistance Levels: 0.72715, 0.7407

Medium Term Path: I could see a grind higher for AUD/USD. There is a bullish Renko structure coupled with positive May seasonality. RBA rate hike expectations are also supporting the case for the upside. Firstly is the upper end of the range near 0.72215. Once that range is fully broken, a strong case is made for the 0.7407, particularly if rate differentials and risk appetite continue to favour the Aussie.

Price doesn’t go straight up so pullbacks are constructive. AUD/USD needs to hold above 0.7014 support and the long-term SMA on the Renko for it to remain positively biased.