AUD/USD breaks out above 100-day average; bulls eye 0.6560 as USD/CAD slides to key retracement
The Australian dollar pushed through a heavy technical cap, lifting AUD/USD beyond its 100-day moving average and weekly highs, signaling a momentum shift that could entice trend-followers as North American trade unfolds.
AUD/USD: Clean break unlocks higher targets
The pair vaulted above the 100-day moving average around 0.65316 and cleared a week-long ceiling near 0.6540, handing initiative to buyers. The move puts immediate upside focus on 0.6551, followed by a broader resistance band at 0.6561–0.6564—a zone that capped rallies earlier this month.
Intraday, the former cap around 0.6540 now acts as first support, with the 100-day MA a critical line to defend for bulls. A sustained hold above these levels would reinforce the breakout narrative and could compress implied volatility as shorts reduce exposure.
The broader backdrop remains constructive for high-beta FX, with risk appetite steady and commodity-linked currencies catching a bid. Month-end positioning could amplify moves if momentum accounts chase topside levels.
USD/CAD: Support cracks as price tests 50% retracement
USD/CAD extended lower after slicing through a closely-watched support band at 1.3968–1.3975, with the downside stretching to around 1.3939. Price is probing the 50% retracement of the advance from the September swing low at approximately 1.39367.
A firm break below the midpoint would expose deeper pullback risk, while a bounce from here would keep the broader uptrend intact. For now, the loss of near-term support suggests fading USD momentum in North American hours, with oil-sensitive CAD gaining marginally alongside stable crude sentiment.
Market snapshot
- AUD/USD clears the 100-day MA at 0.65316 and the week’s ceiling around 0.6540.
- Upside levels in view: 0.6551 and 0.6561–0.6564.
- Invalidation for AUD/USD bulls: back below 0.6540 and especially under the 100-day MA.
- USD/CAD drops through 1.3968–1.3975 support, tests the 1.39367 50% retracement.
- Risk tone steady; month-end flows and liquidity may intensify moves across FX majors.
Why it matters for traders
Breakouts through long-watched moving averages often trigger follow-through as systematic and discretionary accounts align. For AUD/USD, the first topside cluster into 0.6560 will be a test of conviction; failure to hold above 0.6540 would signal a false break. In USD/CAD, the 50% retracement is a classic inflection: a hold can reassert the uptrend; a breach opens room to deeper retracements.
Levels to watch
- AUD/USD resistance: 0.6551; 0.6561–0.6564
- AUD/USD support: 0.6540; 0.65316 (100-day MA)
- USD/CAD resistance: 1.3968–1.3975 (now resistance if recovered)
- USD/CAD support: 1.39367 (50% retracement); 1.3939 (intraday low area)
Trading perspective
– AUD/USD: Dips toward 0.6540 may attract buyers while the 100-day MA holds. A daily close above 0.6564 would strengthen the bullish structure and invite medium-term targets higher.
– USD/CAD: A bounce from the 50% retracement keeps the broader uptrend alive; failure there risks a deeper correction toward prior congestion zones.
FAQ
What pushed AUD/USD higher today?
A clean technical break above the 100-day moving average and the week’s resistance around 0.6540 unleashed upside momentum, with buyers targeting nearby resistance clusters. Steady risk appetite also supported the Australian dollar.
Where are the next resistance levels for AUD/USD?
The next hurdles are around 0.6551 and then the 0.6561–0.6564 zone. A daily close above 0.6564 would mark a stronger bullish continuation signal.
What would invalidate the bullish AUD/USD setup?
A drop back below 0.6540 would warn of a false breakout. A sustained move under the 100-day moving average near 0.65316 would negate the near-term bullish bias.
Why is USD/CAD falling and what is the key level now?
USD/CAD slipped after breaking below short-term support at 1.3968–1.3975. The pair is testing the 50% retracement of the move up from the September low around 1.39367—a pivotal level that can determine whether the pullback deepens.
How might month-end flows affect these pairs?
Month-end rebalancing can increase volatility and exaggerate directional moves, especially around key technical breaks. Traders often see larger-than-usual swings as liquidity thins and systematic flows kick in.
What should traders watch next?
For AUD/USD, watch price behavior around 0.6560 and the ability to hold above 0.6540. For USD/CAD, monitor whether the 1.39367 retracement holds. Any reversal in broader USD tone or shifts in risk sentiment could quickly alter momentum across majors.
This article was produced by BPayNews for informational purposes and reflects current FX market dynamics and technical levels referenced above.
