The Australian dollar extends recovery from last week’s low at 0.7070, advancing for the second straight day, boosted by fresh optimism over US/China trade talks.
US President Trump said he will delay increasing tariffs on Chinese goods, following substantial progress in talks.
Trump also mentioned plans for the summit with Chinese President Xi to conclude agreement that further lowered fears about trade war.
Risk-sensitive Aussie reacted on optimistic news from last Friday and rallied from strong support at 0.7070, hit after significant fall on Thursday.
Recovery probes again through a cluster of MA barriers and pressures the upper boundary at 0.7160 (100SMA), break of which would open way for retest of last Thursday’s strong upside rejection / Fibo 61.8% of 0.7295/0.7054 at 0.7203.
Bullish techs on lower timeframes and improved picture on daily chart underpin recovery, as top of thick hourly chart (0.7138) holds Monday’s action.
Retest of 0.7161 and potential break higher would signal extension of recovery from 0.7054 base towards 200SMA (0.7264).
Rising 10SMA (0.7125) offers solid support and needs to hold to keep fresh bulls in play.
Res: 0.7161, 0.7203, 0.7238, 0.7264
Sup: 0.7148, 0.7125, 0.7082, 0.7070
