AUD/USD Video 16.02.21.
Australian Dollar Pulls Back
AUD/USD made an attempt to settle above the resistance level at 0.7800 but lost momentum while the U.S. dollar remained under pressure against a broad basket of currencies.
The U.S. Dollar Index has recently made another attempt to settle below the nearest support level at 90.30 but failed to develop downside momentum. Currently, U.S. Dollar Index remains stuck in the range between the support at 90.30 and the resistance at 90.50. A move above the resistance at 90.50 will push the U.S. Dollar Index towards the 20 EMA at 90.60 which will be bearish for AUD/USD.
Today, foreign exchange market traders will likely keep a close eye on the latest developments in the oil market. The recent rally provided material support to commodity-related currencies, including Australian dollar.
However, oil looks overbought, and the risks of a pullback are increasing. If WTI oil settles below the psychologically important $60 level, it will gain downside momentum which will be bearish for the Australian dollar.
AUD/USD failed to settle above the resistance level at 0.7800 and declined towards the support at 0.7780. Currently, AUD/USD is trying to settle below this support level.
If this attempt is successful, AUD/USD will move towards the next support which is located at 0.7760. A move below this level will open the way to the test of the support at 0.7740. In case AUD/USD declines below the support at 0.7740, it will head towards the next support at 0.7725.
On the upside, AUD/USD needs to stay above the support level at 0.7780 to have a chance to develop upside momentum in the near term. If AUD/USD manages to stay above this level, it will get to another test of the resistance at 0.7800. AUD/USD will likely have better chances to settle above this level on the second attempt.
If AUD/USD settles above the resistance at 0.7800, it will head towards the next resistance level at yearly highs at 0.7820.
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