The AUDUSD regains traction on Thursday and regains 0.72 handle, following strong rejection at 100DMA (0.7227) on Wednesday, which resulted in a shallow pullback, contained by broken Fibo 38.2% of 0.7661/0.6828 and keeping larger bulls intact.
Fundamentals remain supportive for the Aussie as data released today showed that Australia’s trade surplus widened in April, while retail sales came in line with expectations.
Traders focus on RBA’s policy meeting next week, with wide expectations for 0.25% rate hike, but surprise 0.35%/0.4% raise is also on the table as strong inflationary pressures suggest that more aggressive action would be required.
Technical studies are mixed as strong bullish momentum is fading and stochastic reversed from overbought territory, while 100DMA (0.7227) and 200DMA (0.7227) weigh and conflict with 10/20/30DMA’s in bullish configuration and underpinning bulls.
Near-term action is holding within a range for the fourth straight day, in the movement that could be described so far as a consolidation.
Key events, such as US jobs data this week and RBA policy meeting next week, are in focus and expected to provide fresh direction signals.
Res: 0.7227; 0.7244; 0.7256; 0.7307
Sup: 0.7140; 0.7078; 0.7051; 0.7025
