AUD/USD bulls attack 10-D SMA, need a close above it

• AUD/USD bulls attempting a test of the 10-D SMA.
• AUD/USD maximising on a pullback in the DXY from YRD highs.

AUD/USD has been bid up to the 50-hr SMA at 0.7526 as the dollar tails off a touch from session highs so far of 92.9740 DXY supporting a bid in the commodity complex. Currently, AUD/USD is trading at 0.7525, down -0.18% on the day, having posted a daily high at 0.7545 and low at 0.7493.

AUD/USD has been struggling to recover from the mid-April downside from the 0.78 handle where a resurgence in the greenback has been fueled by both the partial unwinding of the reflation trade (commodities/EMs/Europe)  and sentiment for the Fed to hike three to four times before 2018 is out. 

Eyes on 10-D SMA

The dollar was strong into the Friday close after the nonfarm payrolls was taken as a positive and after an initial offer in Asia, markets today have seen no reasons why not to follow through on the bid at the start of the week, pushing the DXY to the highest levels since December 2017 - The Aussie had been the poorest performance overnight. There has been some demand for the pair in NY/late London, but there needs to be a close above 0.7526/10-D SMA if the correction is to have any material impact.

AUD/USD levels

AUD/USD continues to trade below the monthly and daily trend line. Technicals remain bearish and the monthly RSI is biased down. 0.7420 is on the cards although RSIs are turning higher and out of oversold territory, pointing to a period of consolidation. However, on a break higher and through the rising 200-D SMA on the 0.78 handle,  0.7910 will be in focus.