AUD/USD analysis: bouncing from multi-month lows, but upside still limited

AUD/USD Current price: 0.7531

Australian housing data and Government budget up next.
AUD/USD current recovery lacks background, bearish trend intact.

The AUD/USD pair is up daily basis, trading near a daily high of 0.7544 heading into the Asian session, helped mostly by persistent dollar's weakness, although the intraday range has been quite limited due to the absence of macroeconomic news that could act as a catalyst. Things will turn more interesting starting this Monday, as Australia will release its NAB business confidence index alongside with some housing data, while the Australian Government will offer an update on the economic and fiscal outlooks from the previous budget.

The potential of an extension upward is well limited as long as the pair remains below 0.7600, with the current movement seen as a modest correction after the pair flirted with 0.7500 late last week. Technically, the short-term picture has become neutral, as the price has managed to advance a few pips above a strongly bearish 20 SMA, but technical indicators have lost their upward potential after reaching their mid-lines, now turning south. From the current level, the immediate resistance is 0.7575, the level to surpass to confirm another leg higher, but it would take a clear extension beyond 0.7610 to pose a more constructive outlook for the next sessions.

Support levels: 0.7500 0.7450 0.7420

Resistance levels: 0.7575 0.7610 0.7640

View Live Chart for the AUD/USD

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