AUDUSD jumped to three-week high on Wednesday, advancing almost 0.5% in Asian/early European trading, lifted by comments from RBA official about worsening inflation outlook that boosts the central bank’s existing hawkish stance.
Fresh acceleration broke above psychological 0.70 resistance and cracked pivotal Fibo barrier at 0.7025 (38.2% retracement of 0.7237/0.6894 descend), close above which to confirm bullish signal, (also formation of a double-bottom pattern after rising weekly cloud contained larger downtrend), that contributes to reversal scenario.
However, bulls face other significant barriers en-route, with immediate obstacle laying at 0.7032 (100DMA), followed by 0.7046 (200DMA), after the moving averages recently formed a bear-cross, with sustained break above these barriers to accelerate recovery.
Strong positive momentum on daily chart supports the action, but caution required as overbought stochastic may produce headwinds to recovery rally that extends into fourth consecutive day.
Near-term action is expected to remain biased higher while holding above 0.70 level.
Res: 0.7032; 0.7046; 0.7065; 0.7075
Sup: 0.7000; 0.6990; 0.6975; 0.6947
