AUD/USD risks falling back under 0.77

Source: Dukascopy Bank SA
© Dukascopy Bank SA
"Because the market is very reluctant to price more Fed tightening for this year and next, nominal yields are not rising as fast as inflation expectations are and therefore U.S. real yields have not moved in the [US] dollar's favour in spite of the better data." 
- BNP Paribas (based on Reuters) 


Pair's Outlook 
The Aussie managed to outperform the US counterpart again on Wednesday, thus, preserving the channel pattern. Furthermore, the AUD/USD currency pair reached a 15-week high yesterday, as it reached the 0.7720 level. The Aussie, however, is likely to struggle to advance further, as the upper Bollinger band, the weekly R2 and the monthly R1 form a strong supply area just 15 pips away. The weekly R1 is now the nearest support, but will doubtfully limit possible losses. More focus should be on the channel's support line instead, which rests at 0.7664. Meanwhile, technical studies suggest the commodity currency is to end the day in the green zone. 

Traders' Sentiment 

Today three quarters (66%) of traders are short the Aussie (previously 64%). The share of purchase orders, however, surged from 43 to 50%.
© Dukascopy Bank SA

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