AUD/USD analysis: Aussie recovers, bullish above 0.7120

Valeria Bednarik FXStreet

AUD/USD Current price: 0.7080

Australian dollar recovers fast with US indexes shallow bounce from multi-month lows.
Run to safety paused in the American afternoon, dollar gives up some ground.

The AUD/USD pair fell to 0.7054 at the beginning of the day, retesting the mentioned low following Wall Street's opening, as the Aussie was dragged lower by the sour market's sentiment that sent worldwide indexes into a selling spiral. Australian macroeconomic calendar had nothing to offer early Tuesday and will remain empty this Wednesday, which means that the pair will continue trading alongside with sentiment. Meanwhile, gold prices soared to fresh 3-month highs on the run to safety, somehow lending support to the commodity-linked currency.

The pair is trading marginally up daily basis, reacting with more conviction to equities' advances than to slumps, somehow suggesting that speculative interest is more willing to send the pair higher than lower. Nevertheless, it is still below the 23.6% retracement of its October decline at around 0.7090, the immediate resistance, and in the 4 hours chart, also below firmly bearish moving averages. In the mentioned chart technical indicators have lost their bearish strength, bouncing modestly but still within negative ground, falling short of confirming a bullish extension ahead. The upside will look more constructive on an advance beyond the weekly highs in the 0.7120 price zone.

Support levels: 0.7040 0.7000 0.6960

Resistance levels: 0.7090 0.7120 0.7155

View Live Chart for the AUD/USD

Author

Valeria Bednarik

FXStreet

Valeria Bednarik was born and lives in Buenos Aires, Argentina. Her passion for math and numbers pushed her into studying economics in her younger years.

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