The Australian dollar moved higher in early Monday’s trading, backed by weaker US dollar, on repeated probe above rising daily cloud (cloud top lies at 0.7859) and hit levels near 0.79 barrier (round-figure resistance, reinforced by falling 20SMA).
Firm break above daily cloud will be bullish signal, however, mixed setup of daily MA’s suggests no clear direction signal.
The pair gained momentum but needs close above 20SMA to generate firmer signal for extension of recovery leg from 0.7803, where bears stalled on approach to key support at 0.7776, provided by converged 100/200SMA’s.
Broken cloud top now acts as support which should contain dips to keep fresh bulls in play, otherwise near-term outlook could turn bearish again if the pair fails to close above daily cloud.
Res: 0.7880, 0.7900, 0.7913, 0.7947
Sup: 0.7859, 0.7828, 0.7803, 0.7790
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