While risk on-sentiment is supporting commodity currencies in general, Aussie has been outperforming others recently. Reacceleration in Australian consumer inflation as shown in last week’s November monthly CPI data suggests little room for RBA to pause for now. Additionally, there is optimism over China’s reopening, as well as resumption of coal purchases.
AUD/CAD opened the week with solid buying. the development should confirm resumption of whole rise from 0.8596 low. Near term outlook will stay bullish as long as 0.9142 support holds, even in case of retreat. Next target is 61.8% projection of 0.8596 to 0.9328 from 0.9142 at 0.9594.
During the move, AUD/CAD should also take out 0.9514 resistance to confirm completion of the three-wave corrective decline from 0.9991 (2021 high). That would set the stage for further rally through 0.9991 to resume the rise from 0.8058 (2020 low) in the medium term.