The Australian dollar has seen significant growth since March, when it reached an 18-year low. In five months, it has risen from 0.55 to 0.74 against the U.S. dollar. A weak dollar, strong market performance, huge demand for iron ore from China and central bank monetary policy have helped the AUD lift off multi-year lows. For the rest of the year, Aussie performance will be sensitive to market volatility.
The AUDUSD pair has reached the resistance level at 0.7340 and to clear the way for further growth, it needs to overcome the 0.7415 level. The next resistance would be around 0.7680. If the exchange rate reverses from the current level, the first support that would stop the decline is around 0.7000. The pair has tested this level three times since September and is converging with the rising 50-period moving average on the weekly chart. If US equity markets remain strong and the dollar continues to weaken, the Aussie could be on its way to resistance levels.