- AUD/USD has sensed a minor correction after a perpendicular recovery from 0.6720.
- An improvement in investors’ risk appetite has underpinned the Australian Dollar.
- The Aussie asset needs to surpass 0.6800 for an upside move ahead.
The AUD/USD pair has sensed a minor correction in the early Tokyo session after a perpendicular recovery from 0.6720. The Aussie asset is likely to extend its recovery to near the round-level resistance of 0.6800 as the risk appetite of the market participants has improved dramatically.
A stellar recovery in the S&P500 on Thursday as investors rushed for dip buying after a two-day sell-off underpinned risk-off mood. The US Dollar Index (DXY) dropped to near the lower end of the weekly trading range around 103.60.
On a four-hour scale, the Aussie asset is auctioning in a Rising Channel chart pattern, which is highly neutral as it has formed after a sell-off move from December 13 high around 0.6900. The round-level resistance of 0.6800 has remained a critical barrier for the Australian Dollar for the past 15 trading sessions.
A recovery move in the Aussie asset has pushed it above the 20-period Exponential Moving Average (EMA) around 0.6747. Also, the 200-EMA at 0.6700 is still solid, which indicates that the long-term trend is still bullish.
The Relative Strength Index (RSI) (14) is struggling to shift into the bullish range of 60.00-80.00. An occurrence of the same will trigger bullish momentum.
For an upside move, the Australian Dollar needs to surpass Wednesday’s high around 0.6800, while will drive the Aussie asset towards December 13 high around 0.6880 followed by the psychological resistance at 0.7000.
On the contrary, a breakdown of December 27 low at 0.6719 will drag the major towards December 15 low around 0.6677. A slippage below the latter will expose the asset for more downside toward December 20 low at 0.6629.
AUD/USD four-hour chart
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD stays in positive territory above 1.0850 after US data
EUR/USD clings to modest daily gains above 1.0850 in the second half of the day on Friday. The improving risk mood makes it difficult for the US Dollar to hold its ground after PCE inflation data, helping the pair edge higher ahead of the weekend.
GBP/USD stabilizes above 1.2850 as risk mood improves
GBP/USD maintains recovery momentum and fluctuates above 1.2850 in the American session on Friday. The positive shift seen in risk mood doesn't allow the US Dollar to preserve its strength and supports the pair.
Gold rebounds above $2,380 as US yields stretch lower
Following a quiet European session, Gold gathers bullish momentum and trades decisively higher on the day above $2,380. The benchmark 10-year US Treasury bond yield loses more than 1% on the day after US PCE inflation data, fuelling XAU/USD's upside.
Avalanche price sets for a rally following retest of key support level
Avalanche (AVAX) price bounced off the $26.34 support level to trade at $27.95 as of Friday. Growing on-chain development activity indicates a potential bullish move in the coming days.
The election, Trump's Dollar policy, and the future of the Yen
After an assassination attempt on former President Donald Trump and drop out of President Biden, Kamala Harris has been endorsed as the Democratic candidate to compete against Trump in the upcoming November US presidential election.