AUD/USD climbs to over 1-week tops, closer to mid-0.6000s

The AUD/USD pair built on its goodish intraday positive move and climbed to over one-week tops, closer to mid-0.6000s during the Asian session on Wednesday.

The pair extended its recent recovery momentum from over 17-year lows and gained some follow-through traction for the fourth consecutive session. The Fed's unprecedented QE program to buy unlimited amounts of Treasury bonds and mortgage-backed securities continued weighing on the US dollar, which was seen as one of the key factors driving the pair higher.

Adding to the optimism over the Fed's open-ended and unlimited QE, the US Senate finally reached an agreement on a stimulus package to offset any negative impact from the coronavirus pandemic on the US economy. The latest developments boosted investors' confidence and the same was evident from improving global risk-sentiment, recovery in the equity markets.

The risk-on flow provided an additional boost to perceived riskier currencies, including the Australian dollar, and remained supportive. The positive momentum took along some short-term trading stops near the 0.5975-85 supply zone and contributed to the pair's strong momentum beyond the key 0.60 psychological mark.

It, however, remains to be seen if the pair is able to capitalize on the ongoing recovery or meets with some fresh supply at higher levels amid mounting fears over an imminent global recession in the wake of lockdowns due to the coronavirus pandemic.

Moving ahead, market participants now look forward to the US economic docket – highlighting the release of Durable Goods Orders data – for some short-term trading opportunities later during the early North-American session.

Technical levels to watch