AUD/USD is trying to get to the test of the nearest resistance level at 0.7380.
Australian Dollar Moves Higher Against U.S. Dollar
AUD/USD managed to get above the resistance at 0.7360 and is moving towards the next resistance at 0.7380 while the U.S. dollar remains under serious pressure against a broad basket of currencies.
The U.S. Dollar Index declined to 91.85 and is very close to the test of the yearly lows at 91.75. If the U.S. Dollar Index manages to settle below this support level, it will gain additional downside momentum which will be bullish for AUD/USD.
Yesterday, U.S. reported that Initial Jobless Claims increased to 778,000 while Continuing Jobless Claims declined to 6.1 million. Traders will mostly pay attention to the dynamics of Initial Jobless Claims as they highlight the current state of the job market.
Other economic reports were not very encouraging as Personal Income declined by 0.7% while New Home Sales decreased by 0.3% month-over-month in October.
While the U.S. dollar remains under significant pressure, its ability to develop additional upside momentum may be limited today as many traders are not active on the foreign exchange market due to Thanksgiving holiday.
AUD/USD developed strong upside momentum and continues to move higher. RSI is still located in the moderate territory so there is plenty of room to gain additional momentum in case the right catalysts emerge.
The nearest resistance level for AUD/USD is located at 0.7380. If AUD/USD manages to settle above this level, it will head towards the next resistance at 0.7400.
A successful test of the resistance at 0.7400 will push AUD/USD towards the next resistance at yearly highs at 0.7415. A move above yearly highs will signal that AUD/USD is ready to continue its upside trend after a period of range-bound trading between 0.7000 and 0.7400.
On the support side, the previous resistance at 0.7360 will likely serve as the first support level for AUD/USD. A move below this level will open the way to the test of the next support at 0.7340. If AUD/USD declines below this level, it will gain downside momentum and head towards the next support at 0.7325.