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Higher But Outlook Fragile

AUD

AUD/USD is higher in early Asia-Pac trade on Monday, the rate last changing hands at 0.7280 with a gain of 21 pips on the session, building on Friday's gain.

  • From a technical perspective the AUD/USD outlook remains fragile following the week's move lower and despite Thursday's gains. 0.7194 has been cleared, the 76.4% retracement of the Aug 20 - Sep 3 rally and signals a resumption of the near-term downtrend. Attention is 0.7106, the Aug 20 low and bear trigger - a breach would confirm a resumption of the downtrend that started late February. Firm resistance is seen at 0.7335, the 50-day EMA.
  • The weekend saw new COVID cases appear in Tasmania & South Australia, although the market has looked through the news (as has been the case with most COVID matters in recent weeks). Melbourne Institute inflation data headlines a thin local docket on Monday.

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