The AUD/USD edged higher and reached new highs, looks determined to increase further and could touch other upside targets. Has rallied and has jumped above the 0.7711 previous high, signalling that the bulls are in full control on the short term and could drive the rate much higher in the upcoming period.
Aussie rallied versus the USD even if the dollar index has remained somewhere above the 95.50 psychological level and above the 95.45 previous low. USDX is struggling to increase again, but remains to see what will happen because remains under selling pressure. Could move sideways in the upcoming days and could test a major dynamic support, which could send the index higher again. Only an important USDX’s rally will force the AUD/USD to turn to the downside again, is premature the say what will happen because the perspective is bullish right now.
The Aussie rallied on the positive Australian data, the MI Inflation Expectations rose by 4.4%, while the Chinese data have come in mixed, the Trade Balance impressed today, the surplus increased from 282B to 294B, eating the 273B estimate. Moreover the Foreign Direct Investment dropped by 0.1%, while the USD-Denominated Trade Balance increased from 40.8B to 42.8B, but failed to reach the 42.9B estimate.
USD posted some gains after the US data publication, has received a helping hand from the PPI, which increased by 0.1% in June, beating the 0.0% estimate and the 0.0% growth in the previous reading period. Unfortunately the Unemployment Claims have failed to reach the 245K estimate, were reported at 247K jobs in the previous week, while the Core PPI rose by 0.1%, less versus the 0.2% estimate and compared to the 0.3% growth in May.
The US Federal Budget will be released tonight and is expected to increase from -884B to -36.2B, but I don’t believe that will have enough power to save the dollar from downside.

AUDUSDdaily-1

Price is trading in the green and is approaching the 0.7755 static resistance, is trading much above the 0.7711 previous high and above the median line (ml) of the minor ascending pitchfork (see the H4 chart). The next important upside target remains at the upper median line (uml) of the major ascending pitchfork, is attracted by this level after the failure to close on the median line (ml). The 0.7755 level represents a long term major obstacle, you can see that has rejected the price in the last breakout attempts, so another leg lower could appear after the impressive rally.

AUDUSDh4-1

Price is challenging the median line (ml) of the minor ascending pitchfork, personally I see a bearish divergence on the H4 chart, but is premature to say what will happen in the upcoming weeks, right now we don't have a reversal signal. Will increase further if will stabilize above the median line (ml).

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