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AUD/USD Rebounds After Key Technical Support Holds
The AUD/USD currency pair experienced a significant decline following the Federal Open Market Committee (FOMC) rate decision, dropping to around 0.7078. This downturn was halted at a crucial technical support zone, which included the rising 100-day moving average at 0.70795 and the 50% retracement level from a previous low at 0.70773. The convergence of these technical indicators attracted traders' attention, leading to a slowdown in selling momentum and allowing buyers to re-enter the market.
As the selling pressure eased, the Australian dollar began to recover, aided by a decrease in U.S. Treasury yields and rising commodity prices, including gold and silver. The Australian economy is heavily reliant on commodity exports, making the currency sensitive to fluctuations in commodity markets. The combination of a softer U.S. dollar and stronger commodity prices provided a favorable environment for the AUD/USD to rebound.
The rebound gained traction as the AUD/USD moved above key levels of 0.70908 and 0.71017, indicating a shift in short-term momentum towards buyers. However, the next significant resistance lies between 0.71168 and 0.71270, which includes the 38.2% retracement level and a falling 100-hour moving average. For buyers to solidify their control, they must sustain a move above this resistance zone, while a retreat below 0.71017 could signal a loss of bullish momentum and bring the major support area back into focus.
Source: KLEA News