The Australian dollar is consolidating under three-month high (0.7407), posted after fresh probe through 0.7400 earlier today.
Bulls remain well supported by rising positive sentiment on vaccine expectations that continues to deflate US dollar and ahead of Tuesday’s RBA policy meeting.
The central bank is expected to keep record low interest rate (0.1%) and to maintain it’s a$ 100billion quantitative easing program, with no signs of change in policy guidance expected to further underpin the Aussie, but trade tensions between Australia and China provide headwinds.
Bulls focus Aug/Sep peaks (0.7403/0.7413), with clear break here to complete 0.7413/0.6691 corrective phase and signal continuation of recovery leg from March’s low at 0.5509 towards targets at 0.7515 (Fibo 76.4% of 0.8135/0.5509 descend) and 0.7561 (base of falling monthly cloud).
Overbought stochastic on daily and weekly chart and weaker bullish momentum, warn of extended consolidation before bulls resume.
Dip-buying remains favored above rising 10DMA (0.7331) while break here would ease upward pressure and allow for deeper pullback.
Res: 0.7403; 0.7413; 0.7483; 0.7515
Sup: 0.7368; 0.7331; 0.7292; 0.7255
