AUD/USD Grinds North, Could Extend Gains Towards Its Recent High at 0.7555

AUD/USD Current Price: 0.7423

• China posted a record surplus of $42 billion with the US in October.
• Australia will  October NAB’s Business Confidence, previously at 13, and NAB’s Business Conditions.
• AUD/USD grinds north, could extend gains towards its recent high at 0.7555.

The AUD/USD pair recovered the 0.7400 threshold and trades around 0.7420, heading into the Asian opening. The pair started the day with a soft tone, despite Chinese data surprised on the upside. The country’s Trade Balance posted a record surplus in October, also posting a record surplus of $42 billion with the US. Exports were upbeat, while imports were up by less than anticipated.

Resurgent equities during the American afternoon and soaring gold prices provided additional support to the aussie in the absence of Australian news. Early on Tuesday, the country will release October NAB’s Business Confidence, previously at 13, and NAB’s Business Conditions.

AUD/USD short-term technical outlook

The AUD/USD pair has extended its recovery above the 38.2% retracement of its latest daily advance after meeting buyers around the 50% retracement on Friday. The daily chart shows that the pair has found buyers around a flat 100 SMA, while it remains below a mildly bullish 20 SMA. The Momentum indicator maintains its bearish slope within negative levels, but the RSI is aiming higher at around 50, hinting at a possible extension of the current advance.

The pair is neutral-to-bullish according to the 4-hour chart, as it is grinding higher above its 20 and 200 SMAs, while technical indicators are crossing their midlines into positive levels. The next Fibonacci resistance level is located at around 0.7460, with a break above it favoring a bullish continuation on Tuesday.

Support levels: 0.7370 0.7330 0.7295

Resistance levels: 0.7460 0.7500 0.7550