Bulls likely to take a breather before firm break of psychological 0.70 barrier
The AUDUSD hit new multi-month high in early Monday’s trading, following a probe above psychological 0.70 barrier for the first time since mid-August.
Aussie is underpinned by renewed risk sentiment on expectations of Fed slowing the pace of rate hikes, higher commodity prices on China’s reopening and growing optimism that global inflation has hit its peak and started to ease.
Bulls look for clear break of 0.70 pivot to open way for test of next key barriers at 0.7076/91 (weekly cloud base / Fibo 61.8% of 0.7661/0.6170) and 0.7136/71 (Aug high / weekly cloud top) in extension.
Although the key factors continue to support the action, headwinds from 0.70 resistance zone are very likely to slow bulls for consolidation / limited correction, as daily studies are overbought and bullish momentum is fading.
Dips should find support above rising daily Tenkan-sen (0.6868) to keep bulls intact for fresh push higher, while extension and close below rising daily Kijun-sen (0.6824) would put bulls on hold for deeper pullback and expose the top of rising daily cloud (0.6710).
Res: 0.7000; 0.7076; 0.7091; 0.7136
Sup: 0.6915; 0.6868; 0.6824; 0.6739