The Aussie dollar has gained ground strongly against the greenback in the last couple of weeks as Fed rate cut expectations, improving global market sentiment, especially with regard to trade and strong local data have combined to propel that the currency just over 2.5% higher from its mid-October lows.
Recent CPI data came in well above expectations and market pricing for a further rate cut from the Reserve Bank of Australia has dropped from a 40% chance to just a 10% expectation and this has further aided the Aussie rally. A lot will depend on the market reaction to this weeks Federal Reserve rate update, but overall traders are expecting the Aussie to remain bid on dips in the current environment.
Support now comes in on the Daily charts on the longer-term trendline around 0.6475 with the August and September monthly lows sitting just above the 64-cent level. Resistance on the longer-term trendline is now around the 0.6670 level with the annual high at 0.6706. Any breaks above these levels in the next few weeks could see a run up to challenge 2024 highs above 69 cents.
Resistance 2: 0.6706 – 2025 High
Resistance 1: 0.6673 – Trendline Resistance
Support 1: 0.6478 – Trendline Support
Support 2: 0.6412 – August Low
