AUD/USD rallies from support in US dollar sell-off

<p>AUD/USD (daily chart shown below) has rallied from key support around the 0.9200 level during a general US dollar sell-off in early Tuesday trading. This […]</p>

AUD/USD (daily chart shown below) has rallied from key support around the 0.9200 level during a general US dollar sell-off in early Tuesday trading.

This major 0.9200 support level, last hit a month ago in early April, is presently being reinforced by both the 50-day moving average as well as a solid uptrend support line extending back to January’s 0.8659 multi-year low.

The current bounce off this strong support has fortified the general rebound from extreme lows in AUD/USD that has been in place for the past three months.
AUD/USD chart

 

As of early Tuesday’s rally, the currency pair has been rising to approach key upside resistance around 0.9400, as well as the five-month high of 0.9460 that was last reached just over three weeks ago. A continued resumption of the current uptrend after April’s pullback should push AUD/USD towards its primary upside target around 0.9600.

This 0.9600 level is both the technical pattern target for the recent inverted head-and-shoulders pattern as well as the 50% Fibonacci retracement of the major bearish trend from the 1.0600-area high a year ago down to the noted January 0.8659 multi-year low.

 

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