- US-China trade optimism helped regain some positive traction on Wednesday.
- The set-up seems tilted in favour of bullish traders, though warrant some caution.
The AUD/USD pair reversed an early dip and turned higher for the second consecutive session on Wednesday, with bulls making a fresh attempt to build on the momentum beyond the 0.6900 handle.
The intraday slide once again managed to find some support just ahead of the 0.6880-75 confluence region – comprising of 50% Fibonacci level of the 0.7082-0.6671 downfall and 200-hour SMA.
The mentioned region also marks the lower end of a one-week-old trading range, which should act as a key pivotal point for short-term traders and help determine the pair's near-term trajectory.
Meanwhile, technical indicators on hourly/daily charts have just managed to hold in the bullish territory and support prospects for additional gains amid growing US-China trade optimism.
However, bulls are likely to wait for a sustained break through the mentioned trading range resistance, around the 0.6925-30 region, also coinciding with 61.8% Fibo. level, before placing any aggressive bets.
This is closely followed by the very important 200-day SMA, around the 0.6945 region, above which a bout of short-covering has the potential to lift the pair towards the key 0.70 psychological mark.
On the flip side, sustained weakness below the mentioned confluence support might drag the pair towards the 38.2% Fibo. level support near the 0.6820 region en-route the 0.6800 handle.
AUD/USD 1-hourly chart
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