The 100-day moving average is capping gains for now

The pair has been on a good run higher since the flash crash as the aussie benefited from improved risk sentiment in markets while the dollar struggled on a more dovish Fed rhetoric. But the pair now runs into a key resistance level in the form of the 100-day MA (red line). That level sits at 0.7178 on the day.

Unless buyers find a way to break above that, there won't be any further extension to the upside to test resistance levels seen @ 0.7239 and 0.7315 next. This is very much the same situation as what USD/CAD is experiencing right now.

Looking at the hourly chart, the near-term bias remains more bullish as price holds above the two key hourly moving averages. But in terms of trading sentiment, price is basically sitting at the "high" right now as it runs into the key resistance level above.

Traders will be awaiting a further catalyst to either justify a move higher or see a move back towards testing the 100-hour MA (red line) @ 0.7137 if there is reason for a pullback.

On the day ahead, watch out for risk sentiment in the US cash equity market but also as Fed speakers are due later on as well. Further dovish remarks will be a negative for the dollar and that may be the needed catalyst for price to break above the 100-day MA and extend further to the upside.