The Australian Dollar has been outperforming so far amid a backdrop of reviving risk appetite in the global market, with oil prices and global stocks trading higher today. USA500 futures are up 1.2%, pointing to an open of the cash index later on Wall Street above the highs seen on Friday, which has been sparked by anecdotal signs of strong Black Friday sales in the US.
AUDUSD has gained over 0.5% in making a 5-day high at 0.7276, while AUDJPY has rallied by over 0.7% in making a 1-week high of 82.38. Markets will likely turn more cautious as the Trump-Xi meeting starts to loom, as the signs for a break out of accordance haven’t been looking good, with Beijing recently cancelling what had been intended to be meetings of senior US and Chinese officials to prepare for the Trump-Xi meeting.
Despite the fact that AUDUSD has ascended in recent weeks, it remains in an overall bearish outlook, as a downwards channel has been unfolding since late January from levels above 0.8100. Similarly, in the intraday chart, the formation of a tweezer top at the top of the hour, confirms the bearish momentum as well. The pair has Resistance at 0.7276 (double top in the 4-hour chart), and Support at the 20-day SMA and day’s low at 0.7224. Further decline could retest the 0.7200 barrier.
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