AUD/USD Forex Signal: Breakout Means More Upside For Aussie – 24 March 2022
The pair will likely keep rising with the next key resistance being at 0.7550.
Buy the AUD/USD pair and set a take-profit at 0.7550.Add a stop-loss at 0.7440.Timeline: 1 day.
Set a sell-stop at 0.7440 and a take-profit at 0.7350.Add a stop-loss at 0.7525.
The AUD/USD pair continued its bullish trend in the overnight session as the US dollar retreat continued. It rose to a high of 0.7490, which was the highest level since November 2 last year. The pair has jumped by 7% above the lowest level this year.
Australian Dollar Rebound Gains Steam
The Australian dollar has been in a steady bullish trend in the past few weeks as investors react to the ongoing crisis in Ukraine. Australia is set to partially benefit because of the rising commodity prices.
A quick look at most commodities that the country sells shows that their prices have been in a steady increase since the invasion started. Iron ore prices have risen because of the sanctions implemented on Russia.
The same is true with commodities like coal, natural gas, wheat, and aluminum have all risen and analysts expect that the trend will continue for a while. As a result, demand for the Australian dollar is expected to be strong in the coming weeks.
The AUD/USD pair is also rising as investors price in a change of mind by the Reserve Bank of Australia (RBA). In the meeting held earlier this month, the bank insisted that it was not ready to hike yet. The officials continued to claim that they will only hike interest rates when inflation remains solidly above 2%.
Therefore, analysts expect that the bank will also embrace a more hawkish sentiment considering that inflation is rising while the labor market is tightening. Recent data revealed that the country’s unemployment rate has even moved below where it was before the pandemic.
The pair will also react to the latest economic data from the US. Some of those to watch will be the headline and core durable goods data from the country.
The AUD/USD pair continued its bullish trend in the Australian session on hopes of a more hawkish RBA. It rose to a multi-month high of 0.7490, which was above the previous YTD high of 0.7440. As a result, it managed to invalidate the double-top pattern that has been forming for a while.
The pair also moved above the 25-day and 50-day moving averages while the MACD is above the neutral level. The Relative Strength Index also moved above the overbought level. Therefore, the pair will likely keep rising with the next key resistance being at 0.7550.