AUD/USD leaps to highs near 0.7620 on rate hike chatter
|The Asian recovery seen so far in AUD/USD gained renewed traction, following hawkish comments ex-RBA board member Edwards, which sent the rate back beyond 0.76 handle.
AUD/USD takes-out 0.76 handle, what next?
The AUD bulls gathered pace and extended the rebound well beyond 0.76 handle, in a bid to retest 6-day tops reached yesterday at 0.7624 levels.
The latest move higher can be purely attributed to the renewed hopes of RBA tightening sooner (than later), especially after former RBA board member Edwards noted: “It seems to me that something like eight quarter percentage point tightenings over 2018 and 2019 are distinctly possible.”
Moreover, the extension of broad based US dollar sell-off also continues to provide extra support to the AUD/USD pair. The USD index trades at the lowest levels since November last year, testing 96 handle.
Meanwhile, rising Aussie bond yields offset subdued trading activity seen in oil and copper prices, keeping the sentiment buoyed around the AUD. Focus now remains on a mix of CB speeches due later in early US, alongside the releases of the US goods trade balance and pending home sales data for fresh trading impetus.
AUD/USD Levels to watch
At 0.7612, the pair finds the immediate resistance at 0.7630-40 (key resistances) above which gains could be extended to the next hurdle located 0.7680 (Mar 30 high) and 0.7700 (zero figure). On the flip side, the immediate support is located at 0.7550 (psychological levels). Selling pressure is likely to intensify below the last, dragging the Aussie to 0.7533 (100-DMA) and below that 0.7509/0.7497 (200-DMA/ Jun 7 low).
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