AUD/USD: Reaching New 10-Month Highs
AUD/USD
was lifted on a better risk sentiment in the European session and a
positive close in the Nikkei that finished up 0.19%. Oil has been the
catalyst along with flows through the yen.
With oil prices tailing off overnight, the Yen picked up the bid.
Consequently, AUD/JPY climbed higher once a turnaround came in the price
of oil and pulling AUD/USD back into bullish territory, and this has
been the play for a number of sessions now. Meanwhile, there are some
conflicting announcements in respect of timings of another OPEC and
non-OPEC nations meeting to potentially revive an output freeze
discussion.
All about Oil
Deputy oil minister of Iraq announced that OPEC and other oil producers
will meet in May while Russia have said there is no agreement to meet in
May. Nonetheless, Oil is higher on the prospects of an oil freeze
meeting taking place, rallying to $43.30 spot WTI so far and Aussie
bulls are chasing the bid to fresh highs this week and 2016 so far of
0.7829, a new 10 month high. This news has underpinned the bid in the
oil price post the EIA weekly oil inventories that showed less of a
build at +2080k vs 3000k expected and +6634k prior.
AUD/USD levels
With AUD/USD back above 0.7800 again and iron ore remaining supportive
(ITIJ16 (Apr '16) now above 58.00 and ITIK16 (May '16) now at 62.97 up,
+3.23 ), we should see further appreciation. Supported by the 20 dma at
0.7634 on the wide, AUD/USD targets R1 at 0.7862, R2 at 0.7881 and R3 at
0.7901. The 100 weekly sma is located at 0.7934.
(Market News Provided by FXstreet)
