Australian dollar "increasingly immobilised" -- Westpac

Westpac writes today that the AUD/USD is caught between opposing forces: Chaotic US policy increasingly hurting USD growth risks versus global market deleveraging pressures.

From today's note:

"AUD feels increasingly immobilised, lacking conviction and stuck between competing narratives. On the plus side there's a plainly more constructive medium term AUD outlook developing in real time as US growth risks build and the USD's yield underpinnings are challenged by a prolonged period of policy uncertainty. Tariffs were "supposed" to land more heavily as a downside growth risk for the RoW, but instead frequent policy reversals, chaotic delivery and communication are more obviously unsettling the US outlook."

• AUD has shown resilience despite US equity drawdowns
• The US policy uncertainty shock sapping US exceptionalism (this is a view that's gaining momentum)
• Highlight the German debt brake vote as a risk next Tuesday
• April 2 'reciprocal' tariffs present strategic flush risk for AUD/USD
• Multi-month outlook suggests broad USD weakness despite uneven currency impacts

Here is their technical view:

The base of the channel sits around 0.6220. We can see AUD threatening the base of this channel and lower levels still - the recent 0.6088 lows, if not 0.6000 - for example if de-risking escalates. But we wonder if that ultimately proves to be a false break and a long-term buying opportunity