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AUD/USD strengthens, tracks iron ore prices

FXStreet (Mumbai) - The AUD/USD is trading 0.16% higher at 0.7322 in early Europe, tracking gains in the iron ore prices and turned a blind eye towards economic data out of Australia and China disappointed expectations.

Bid above key fib expansion level

The currency pair ran into fresh bids after it recovered above 0.7306 (100% Fib expansion of Sep 7 low-Sep 18 high-Sep 29 low). The Aussie had dropped to a low of 0.7284 on account of a wider monthly Australian trade deficit and unexpected drop in the Chinese services PMI, but quickly moved back above 0.73 handle.

Moreover, the currency pair is tracking the rise in the Dalian iron ore future; which advanced 1%. Later today, the comments from Fed’s Yellen and the weekly US jobless claims could influence the pair.

AUD/USD Technical Levels

The immediate resistance is seen at 0.7343 (previous day’s high), above which the gains could be extended to 0.7382 (Oct 12 high)-0.74 levels. On the other hand, a break below 0.7306 (100% Fib expansion of Sep 7 low-Sep 18 high-Sep 29 low) would expose 0.7283 (Nov 25 high) and 0.7254 (5-DMA).

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