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AUD/USD flips to gains, flirts with 0.7200

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Dec 14, 2015.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

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    FXStreet (Mumbai) - After a weaker start to the week, the AUD bulls regained lost momentum and jumped back on the bids and brought an end to previous two consecutive days of heavy declines.

    AUD/USD back at 0.72 handle

    Currently, the AUD/USD pair trades 0.14% higher at fresh session highs of 0.7204, having taken out 50-DMA resistance at 0.7189. The Aussie wiped-out early losses and swung into gains, as markets booked profits on their AUD shorts after the pair bounced-off key 100-DMA support near 0.7160 region.

    However, the recovery appears short-lived amid ongoing weakness in oil prices and a broadly stronger US dollar on hopes of 25bps hike in the US interest rates this Wednesday, marking the first rate rise in almost a decade. Moreover, intensifying risk-off sentiment surrounding the Asian indices also curb the demand for higher yielding currencies such as the AUD and therefore keep the gains in check in the AUD/USD pair. Australia’s S&P/ASX slides -1.50% while the Nikkei drops -2%.

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    AUD/USD Levels to watch

    The pair is seen testing 0.72 handle with the immediate resistance located at 0.7211 (5-DMA) above which gains could be extended to the next hurdle located at 0.7248 (20-DMA). On the flip side, the immediate support is seen at 0.7158/57 (100-DMA/ Nov 23 Low). Selling pressure is likely to intensify below the last, dragging the Aussie to 0.7129 (daily S2).
    For more information, read our latest forex news.
     

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