The AUD/USD pair got some aggressive bids at the beginning of the new trading week and developed momentum above the 0.7100 level.
After a sharp weekly pullback last week, the pair regained positive momentum on Friday and was supported by some renewed selling bias of the US Dollar following a new stage of falling US Treasury bond yields.
As the dollar’s bulls were on the defensive, the prevailing risk sentiment reinforced the perceived riskier currency — the Aussie and helped the pair extend a positive momentum through today’s Asian session.
In addition to this, strong growth of almost 2% in Dalian iron ore provided additional impetus to the Australian dollar associated with commodities and maintained a strong tone of supply around the major.
Monday is not expected to release any important economic data affecting the market.
AUD/USD Technical Analysis
The Aussie dollar climbed higher recently and broke the 0.7080 resistance against the US Dollar. The AUD/USD pair even broke the 0.7100 resistance level and settled above the 50 hourly simple moving average.
It is now placed nicely above 0.7100 and traded as high as 0.7114. It is likely to continue higher towards the 0.7125 and 0.7140 resistance levels. On the downside, initial support is near the 23.6% Fibonacci retracement level of the last wave from the 0.7078 low to 0.7114 high.
However, the main support is near the 0.7095 level, which was a key resistance earlier. There is also a major bullish trend line in place with support at 0.7090 on the hourly chart.
Therefore, dips in AUD/USD remains supported as long as the pair is above the 0.7095 and 0.7090 levels in the near term.