AUD/USD keeps the early week bounce going

<p>The stronger Chinese yuan is the main reason helping the antipodean currencies today, with AUD/USD leading gains as it is up 0.5% to 0.6770 currently. The pair continues to keep a bounce off its 200-day moving average from yesterday, but what is the rest of the technical picture saying?</p><p>In the bigger picture, key resistance continues to lie closer to the June and early July highs near 0.6900. That's not quite in the frame for now but the 200-day moving average (blue line) at 0.6721 is. That now defines the key downside support for the pair, before getting to the 100-day moving average (red line) at 0.6687.</p><p>As for the latest bounce today, there are also some near-term challenges:</p><p>The pair did run into some resistance from its 100-hour moving average (red line) earlier but buyers are hoping to push past that now. If so, the near-term bias would then turn more neutral instead. However, there is still further resistance from the 200-hour moving average (blue line) at 0.6800.</p><p>I would pin that as being where sellers might make a stronger stand in keeping the recent downside momentum going.</p><p>In short, we are seeing AUD/USD price action continue to respect key technical levels on the charts. In particular, the daily chart shows that the rejection near 0.6900 is followed up by a test of the 200-day moving average and that has held on the first attempt.</p><p>We'll see if sellers have further appetite in trying for that again but if they are to do so, they would have to put their foot down as noted on the near-term chart above. Tomorrow will be a big day to make or break such a narrative, as we will have Australia CPI data as well as the Fed policy decision coming up.</p><p>So, don't expect the pair to sit still for too long.</p>

This article was written by Justin Low at www.forexlive.com.