**AUD/USD Bounces Off Session Lows and Trades Above Key Moving Averages**
*Adapted and expanded from an article by Barry Edwards, FX Daily Report*
The Australian Dollar (AUD) showed resilience against the US Dollar (USD), bouncing back from its session lows and regaining positive momentum in mid-2024. The AUD/USD currency pair managed to move above a critical technical threshold—the 100-hour moving average (MA)—indicating renewed buying interest among market participants. This price action signals potential for further gains in the near term, contingent on both economic data and global risk sentiment.
This comprehensive analysis unpacks the factors behind the AUD/USD pair’s recent movements, provides a technical breakdown, assesses future prospects, and integrates supplementary insights from broader forex market analysis.
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### Recent Price Movement Overview
– **Session Recovery**: In early trading, the AUD/USD pair dropped to an intraday low, only to stage a notable rebound as the session progressed.
– **Critical Breakthrough**: The pair not only recovered above its session low but also surpassed its 100-hour moving average, which often acts as a dynamic resistance or support level for short-term traders.
– **Current Position**: After overcoming initial bearish pressure, the pair trades near 0.6760, showing stability above short-term moving averages.
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### Main Catalysts Behind the Rally
Several core factors contributed to the AUD/USD bounce:
**1. US Dollar Weakness**
– The US dollar softened in response to dovish remarks by Federal Reserve officials, which dampened expectations for further rate hikes.
– A rise in weekly unemployment claims and signs of cooling economic activity in the US economy pressured the greenback.
– With traders anticipating a possible pause in future Fed rate hikes, the USD lost some of its recent strength.
**2. Risk Sentiment and Equities**
– Global equity markets saw a recovery, fueling broader risk appetite.
– The Australian dollar often benefits during periods of risk-on sentiment due to Australia’s role as a commodity exporter and its links to Chinese economic health.
**3. Commodity Prices**
– Iron ore and other key Australian exports experienced price stabilization, supporting the domestic currency.
– Concerns about a possible slowdown in Chinese demand have faded somewhat, at least temporarily.
**4. Domestic Economic Data (Australia)**
– Australian labor market data met or modestly exceeded expectations, underpinning confidence in the local economy.
– The Reserve Bank of Australia (RBA) struck a cautious but not aggressively dovish tone in its latest communications, providing some support to the AUD.
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### Technical Analysis
**Key Technical Indicators:**
– **100-Hour Moving Average**: This technical metric, hovering near 0.6740–0.6750, was breached upwards after initial session weakness. The break above this line suggests the formation of a short-term bullish trend.
– **Support Levels**:
– Near-term support is seen at the 0.6740 level, corresponding to the recent breakout
Read more on AUD/USD trading.