AUD/USD rises further to test 0.74 on higher commodities

The recovery in the AUD/USD pair gained further traction in the Asian hours this Tuesday, now pushing the rate closer to 0.74 handle, in response to improved risk conditions.

AUD/USD regains 5-DMA and beyond

Currently, the AUD/USD pair jumps +0.30% to test session highs previously posted at 0.7394, having found solid support just below 0.7350 levels.  The Aussie is seen extending its Asian recovery mode, largely on the back of a renewed risk-on wave triggered by sharp gains in the Australian stocks, as higher commodities prices boost the sentiment around the resource and energy stocks, while also underpinning the resource-linked AUD.

The US oil rallies over 1% to $ 48.70, copper futures jump +1.31% to 2.55 levels, iron-ore futures spike 6% and gold also follows suit, advancing +0.66% to trade around $ 1217.

Moreover, extension of the retreat in the US dollar across the board from multi-year tops also aids the ongoing recovery in the Aussie.

Focus now remains on RBA official Kent’s speech due in the European session ahead of the US economic data due to be reported in the NA session, while tomorrow’s Aus construction work, US durable goods and FOMC minutes will also grab a lot of eyeballs.

AUD/USD Levels to watch   

The pair finds the immediate resistance at 0.7452 (10-DMA) above which gains could be extended to the next hurdle located 0.7485 (daily S3) and 0.7500 (round number). On the flip side, the immediate support located 0.7366 (5-DMA). Selling pressure is likely to intensify below the last, dragging the Aussie to 0.7305 (multi-month lows) and below that at 0.7272 (daily S2).

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