The Australian dollar holds in narrow consolidation under new two-week recovery high at 0.7884, posted after rally of past two days.
The action was capped by 55SMA / Fibo 61.8% of 0.7988/0.7712 descend, with signals that bulls may take a breather here. Strongly overbought slow stochastic supports the notion, but without firmer bearish signal so far.
Strong momentum studies and daily MA’s in bullish configuration, favor further advance. Close above 55SMA / Fibo barrier will be bullish signal for extension towards 0.7923 (Fibo 76.4%).
Meanwhile, the price may hold in consolidation with strong support at 0.7837 (sideways-moving 20SMA) expected to contain and keep bulls intact intact.
Conversely, close below 20SMA would weaken near-term structure and risk return to key support at 0.7817 (daily cloud base).
US CPI data are eyed for fresh signals.
Res: 0.7884, 0.7923, 0.7935, 0.7983
Sup: 0.7856, 0.7837, 0.7817, 0.7798
