AUD/USD analysis: backed by commodities and equities

Valeria Bednarik FXStreet

AUD/USD Current price: 0.7474

Commodity-related currencies were among the best performers this Monday, with the AUD/USD pair extending its advance up to 0.7488, its highest since May 3rd. The pair closed the day a few pips below the mentioned high, after RBA deputy governor Debelle said that an increase in the cross currency basis is not always a sign of market's strength, sounding a bit more comfortable at this time. The Australian macroeconomic calendar has nothing to offer during the upcoming session, but the positive momentum in equities and commodities will likely support further Aussie gains. From a technical point of view, the outlook has turned bullish, although an advance beyond 0.7500 will further confirm it, given that the pair has broken above the daily descendant trend line that contained advances since late March. In the 4 hours chart, the price has also settled above its 200 EMA, while the 20 SMA heads north, now converging with the broken trend line around 0.7430. Technical indicators in the mentioned chart have lost upward strength after nearing overbought readings, retracing modestly, not enough to confirm a downward move, but rather a consequence of the short term consolidative stage seen late US session.

Support levels: 0.7470 0.7430 0.7375

Resistance levels: 0.7510 0.7550 0.7590

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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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