The shocking downside result to March Australian consumer confidence nS9N1ZY01E had AUD/USD bears looking forward to a test of barrier protection at 0.7000 but that test looks to be elusive now.
Despite U.S. January March durable goods upside surprise nAQN00C9UC driving Australian-U.S.
yield spreads wider and sending AUD/USD to the daily cloud base nL1N2100ES bears were unable to capitalize and upside risks now remain.
The greenback softened after the durables data as the results are unlikely to alter the Fed's patient stance.
Even with Australian 10-year bond yield below 2 percent and U.S. 10-year yields trading firm AUD/USD rebounded from the daily cloud base and climbed back above the 10-DMA.
Solid gains for equity markets as well as gains in oil and copper futures have helped buoy AUD/USD as have hopes that U.S.-Sino trade talks will yield positive results.
AUD/USD's hold of short-term support near 0.7050 suggests that bulls have the upper hand, though they will have to work to gain greater control. To do this, they'll need to break the daily cloud top, 21-DMA and daily highs from March 5 and 6. If they clear those hurdles the March high and 55-DMA would be the next challenges.
A move above the 55-DMA should then target 0.7200/10 resistance.
chart: Click here