Around the top of the hour, investors will shift gaze to what potentially may become an Aussie mover, with RBA Lowe speech on the labour market in focus. Underpinning the Aussie is also the fact that Iron ore prices are showing some serious signs of strength again, up 27% since the RBA decided to cut rates on Sept 4.
Looking at the hourly chart, and despite the burst higher in the last few hours, the context still gives no indications moves are anything more than correctional in nature. Nonetheless, it is worth noting the latest 1-hour climb has managed to break thru a descending trendline coming from Sept 28 high, thus paving the way for additional gains till 1.0235/40, where sequence of highs/lows from last week are expected to come into play in the form of solid sell orders. Break higher exposes 1.0270 - Sept 5 high.
On the downside, break of weekly lows is necessary to open doors towards parity, level not flirted since late June. A break lower is also likely to mark the end of a long-held daily range present since the escape off parity during mentioned June period. If price heads back lower in the coming sessions, no clear areas of support other than 1.02 round number - reliable thru the course of last week - are identified, with choppiness domiant on the back of latest 70+pips corrective run. AUD/USD dailies are still pointing down "but unless or until the range breaks the move toward 0.9970 is on hold" says Greg McKenna, CEO at LightHouse Securities.