AUD/USD looks to hold a break above its 200-day moving average

AUD/USD D1 27-05

The aussie is up by 0.3% against the dollar currently, trading to a high of 0.6680 moments ago - the highest level since 9 March - as risk trades are more buoyed on hopes of a compromise on the EU recovery fund proposal.

AUD/USD turned around slight losses at the start of the session to now trade above the 200-day MA (blue line) @ 0.6659, the level which limited gains yesterday.

As such, this will be a key point of contention for the pair going into the daily close today.

For buyers, keep above that and price is suggestive of a more bullish breakout; though there is still some resistance around the 9 March high @ 0.6685 and near 0.6700.

But given how much the AUD/USD chart mirrors the S&P 500, the latter is also looking to try and break above its own 200-day moving average and the 3,000 level.

Considering that the risk momentum remains the number one driver in the market right now, a significant break higher for US equities could be the right platform to give AUD/USD a springboard to achieve its next leg higher above the 200-day MA.

Further out, the 0.7000 will surely be an attractive target for buyers if US stocks can keep the momentum going above the key levels outlined above.