AUD/USD hits one-week tops on notable USD weakness

Haresh Menghani FXStreet

The greenback selling pressure remains unabated, now pushing the AUD/USD pair further beyond the 0.7800 handle to fresh one-week tops.

The pair continued gaining traction for the third consecutive session on Thursday and decisively broke through 100-day SMA barrier in wake of the post-FOMC minutes broad based US Dollar weakness.

Despite reaffirming December rate hike expectations, the latest FOMC meeting minutes, released on Wednesday, revealed policymakers' concerns over stubbornly low inflation. Hence, sliding US Treasury bond yields was seen weighing on the buck and benefitting higher-yielding currencies - like the Aussie.

Meanwhile, today's release of home loans data from the Australia, reporting a better-than-expected growth of 1.0% in August, provided an additional boost to the Australian Dollar and collaborated to the pair's strong up-move through early European session.

• Australia: Housing finance approvals remain firm – Westpac

Later during the NA session, the US economic data - PPI figures and weekly jobless claims data, would help traders grab some short-term trading opportunities ahead of Fedspeaks.

• Key US producer price inflation data preview - Nomura

Technical levels to watch

A follow through buying interest has the potential to lift the pair towards 0.7860 horizontal resistance en-route the 0.7900 handle and 50-day SMA barrier near the 0.7915 region.

On the flip side, 100-day SMA, near the 0.7800-0.7795 region, now becomes immediate support to defend, which if broken might drag the pair back towards mid-0.7700s ahead of 2-1/2 month lows support near 0.7730 level.

Author

Haresh Menghani

FXStreet

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

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