**AUD/USD Price Forecast: Testing Higher Ground with 0.6600 in Sight**
**By Pablo Piovano (Original Source: FXStreet)**
The Australian Dollar (AUD) continues to gain momentum against the US Dollar (USD), with the currency pair AUD/USD making notable strides toward the 0.6600 mark. As currency markets remain sensitive to global macroeconomic trends, shifting risk appetite, and central bank policy stances, the movements in AUD/USD attract considerable attention from traders and investors alike.
This article examines the recent performance of AUD/USD, explores the underlying drivers influencing the pair, and assesses future prospects based on technical analysis, market sentiment, and fundamental factors. Additional insights are drawn from various professional sources to provide a well-rounded outlook.
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**Overview: Recent Performance of AUD/USD**
– Following a period of consolidation, AUD/USD recently bounced from lower levels and established a short-term uptrend.
– Resilient support around 0.6550 provided a foundation for buyers to push prices higher.
– With the US Dollar showing signs of short-lived strength, the Australian Dollar capitalized on improved risk sentiment in global markets.
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**Key Drivers Impacting AUD/USD**
Several interrelated factors have shaped the movement of AUD/USD:
1. **Diverging Central Bank Policies**
– The Reserve Bank of Australia (RBA) has taken a cautious stance, balancing concerns over inflation with weaker economic data.
– Meanwhile, the Federal Reserve has signaled a possible pause in rate hikes, affecting USD dynamics.
– Speculation regarding future moves by both central banks generates volatility in the pair.
2. **Commodities and Trade**
– As a commodity-exporting nation, Australia’s Dollar is highly sensitive to commodity prices, particularly iron ore and coal.
– Recent stabilization in major commodity prices has supported the AUD.
3. **China’s Economic Activity**
– China, being Australia’s largest trading partner, exerts a strong influence on the AUD through trade linkages.
– Signs of recovery in China’s economic data have given a mild boost to the Aussie Dollar.
4. **Risk Sentiment**
– The AUD often serves as a proxy for global risk sentiment.
– Periods of heightened risk-taking in financial markets tend to favor the AUD over the USD, especially when concerns over US economic growth or debt persist.
5. **US Economic Data and Dollar Index**
– Key US data releases, such as inflation, employment, and retail sales figures, affect USD strength and can quickly alter the direction of AUD/USD.
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**Recent Technical Picture**
A close examination of the technical backdrop for AUD/USD suggests the following:
– The currency pair rebounded after stabilizing above the short-term support zone near 0.6550.
– A push towards the key 0.6600 resistance is underway, driven by strong buying interest and positive momentum.
– Technical indicators show:
– The 100-hour and 200-hour simple moving
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