- AUD/USD rises above 0.7200 but bulls struggle to take on the further upside.
- China’s reopening news, the US dollar pullback underpin the aussie.
- The pair challenges critical daily resistance, with all eyes on Tuesday’s RBA.
AUD/USD is looking to extend the swift recovery beyond the 0.7230 supply zone, as bulls refrain from placing fresh bets ahead of Tuesday’s Reserve Bank of Australia’s (RBA) rate hike decision.
The aussie is taking advantage of the broad US dollar retreat, as well as, the optimism over the covid lockdown reopening of Chinese cities. The further upside, however, appears capped amid holiday-thinned market conditions and pre-RBA anxiety. A lack of significant US economic releases also keeps buyers a bit tied down.
From a short-term technical perspective, AUD/USD is finding strong hindrance near the 0.7230 area, as it is the confluence zone of the bearish 50- and horizontal 100-Daily Moving Averages (DMA).
AUD bulls are struggling also due to the 50-DMA and 100-DMA bearish crossover over in play, which got confirmed last Friday.
Only a daily closing above the aforesaid resistance will power bulls once again towards the flattish 200-DMA at 0.7258.
Up next, the 0.7300 round figure will be back on buyers’ radars.
The 14-day Relative Strength Index (RSI) is inching slightly higher above the midline, supporting the case for more gains.
AUD/USD: Daily chart
Alternatively, if the price fails to find acceptance above the 0.7230 barrier, then a pullback towards the daily lows of 0.7220 cannot be ruled out.
Sellers will then look out for the 0.7200 demand area, below which a test of the June 2 low of 0.7140 will be challenged.