AUD/USD analysis: short-term bullish near key resistance area

Valeria Bednarik FXStreet

AUD/USD Current price: 0.7430

Aussie finding support in the positive tone of equities, dollar's weakness.
AUD/USD topped in the 0.7440/50 region in the past three weeks.

The AUD/USD pair closed at 0.7430, a few pips below a daily high of 0.7443, underpinned by dollar's weakness and the positive tone of equities. The Aussie plunged at the beginning of the week, following an unsurprising RBA and soft housing data that suggested rates will remain at record lows at least until 2020, and trade tensions between China and the US. The commodity-linked currency, however, later recovered as equities' traders shrug off concerns about a trade war, while the greenback fell out of market's favor. AUD/USD traders will pay attention to Chinese headlines this week, as the country will release June inflation among other figures. Next Tuesday, Australia will release the NAB's business confidence and conditions indexes, seen improving in June from May's readings. The daily chart for the pair shows that it settled above a bearish 20 SMA and well below bearish 100 and 200 SMA, while technical indicators head north, the Momentum above its mid-line but the RSI currently at 49, somehow indicating a limited upward potential. In the 4 hours chart, the upside seems more constructive, as the pair settled above its 20 and 100 SMA, with the shorter crossing above the larger one, as technical indicators hold well above their midlines, barely losing upward strength near overbought levels. The pair topped in the 0.7440/50 region in the past three weeks, with a break above it needed to confirm additional gains ahead.

Support levels: 0.7400 0.7370 0.7335

Resistance levels: 0.7445 0.7480 0.7510

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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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