Before reaching the 0.7340 objective, the primary resistance is the 60-day exponential moving average of 0.7305. The australian dollar has actually been pushed higher as a result of the lower US dollar, but more evident on the short-covering price action rebound as the AUDUSD fell from last Friday's high of 0.7380, the sell-off on talks of another RBA rate cut and China's slowing economy.
China's CPI came out lower than expected in the prior Asian session at 0.1% m/m versus the median forecast of 0.5%. The market has been short AUD since Friday and we have seen the 75 pip rebound from 0.7200 on the intraday chart. If the US dollar heads lower, only then can we see the test of the 0.7305 and 0.7340 levels in the short-term run.
However, the market may still continue to digest China's weak CPI data and the aussie may very well still be in a bearish mode. 0.7200 is the 200-hourly moving average and is a well defined support. The next support levels are: 0.7170, 0.7150, 0.7110.
Charts: WorldWideMarkets Alpha Trader