AUD/USD is trying to keep above its 100-hour moving average currently
Amid the dollar keeping weaker across the board, AUD/USD managed to push to a high of 0.7092 today but is trading around its 100-hour MA (red line) @ 0.7075 currently.
Buyers are trying to wrestle back some near-term control by keeping above the key near-term level, but sellers are putting up some decent resistance so far on the session.
Looking at the charts, the scope for any major upside in AUD/USD may be more limited with short-term resistance seen closer to 0.7100 and also the 100-day moving average resting nearby @ 0.7103 at the moment.
That could very well hinder any upside momentum in AUD/USD, especially with the market also keeping tabs on the RBA policy decision on 3 November.
That said, the 0.7000 handle is also a key support level that is likely to hold considering what has been priced in for the RBA next month, all other things being equal.
As such, the dollar side of the equation is the number one driver of the pair right now and so the risk mood and stimulus hopes are the key factors to watch out for.
So far today, the market is keeping with some optimism and that is also reflected in the bond market - which I would argue is the standout mover so far today.
But is that a broader signal of the reflation trade starting to take hold or is it just a reaction to more (false) hopes being fed to the market on a pre-election deal?
We'll have to wait and see but for the dollar and AUD/USD, the technical levels above will give a clearer indication of the market bias in the coming sessions.
