20 Nov 2013
AUD/USD: constructive bullish structure, risk of targets 0.9450+
FXstreet.com (Barcelona) - AUD/USD firmed up on Tuesday, as heavy dip buying post RBA minutes overwhelmed timid attempts to break through 0.9350 support in the last Asian session.
The initial fall led to an abrupt rotation higher with European-led flows driving the price to a new 7-day high at 0.9450 before retracing towards 0.94, where a solid technical base seems to have been found before reemergence of demand.
AUD sees steady bids
On a fundamental note, we reported yesterday that AUD is expected to be well bid near term on largest Australian bond deal issuance by the Aussie government, likely to attract offshore investors. Besides that, a European headlines saying "PBOC to widen yuan band and end regular intervention", coupled with "presumed Chinese reserves diversification" also saw inflows into the AUD. Lastly, break of 94.50 in AUD/JPY may see increased interest for 'carry trade' plays.
AUD/USD technical perspective
On the technical front, AUD/USD has reinforced its short term bullish bias as proven by the relentless buying interest on dips since a recovery off sub 0.93 on Nov 14. From an hourly perspective, the higher highs and higher lows manifest a constructive picture which should fuel further upside with potential for a retest of 0.9450 - spike high - ahead of 0.9470, 0.95, 0.9520. On the downside, sellers' first mission is to overcome 0.94 on an hourly closing basis and to start working its way down from there.
The initial fall led to an abrupt rotation higher with European-led flows driving the price to a new 7-day high at 0.9450 before retracing towards 0.94, where a solid technical base seems to have been found before reemergence of demand.
AUD sees steady bids
On a fundamental note, we reported yesterday that AUD is expected to be well bid near term on largest Australian bond deal issuance by the Aussie government, likely to attract offshore investors. Besides that, a European headlines saying "PBOC to widen yuan band and end regular intervention", coupled with "presumed Chinese reserves diversification" also saw inflows into the AUD. Lastly, break of 94.50 in AUD/JPY may see increased interest for 'carry trade' plays.
AUD/USD technical perspective
On the technical front, AUD/USD has reinforced its short term bullish bias as proven by the relentless buying interest on dips since a recovery off sub 0.93 on Nov 14. From an hourly perspective, the higher highs and higher lows manifest a constructive picture which should fuel further upside with potential for a retest of 0.9450 - spike high - ahead of 0.9470, 0.95, 0.9520. On the downside, sellers' first mission is to overcome 0.94 on an hourly closing basis and to start working its way down from there.