AUD/USD keeps rising, eyes 0.7900

AUD/USD gained momentum after the beginning of the American session and climbed, breaking above previous highs. The pair bounced at 0.7850 and rose to 0.7892, hitting a 2-day high. 

Currently, the pair trades at 0.7885, up 65 pips for the day, having the best performance in three weeks. Yesterday it dropped to the lowest in almost a month, finding support slightly above 0.7800. 

A decline of the US dollar, particularly against emerging and commodity currencies, is boosting AUD/USD to the upside. The greenback was also affected by weaker—than-expected US data. Housing starts and building permits dropped significantly. 

US: Privately-owned housing starts in July were at 1,155,000

Traders are now waiting for the release of the FOMC minutes of the July meeting. Back then, the Fed left interest rates unchanged, even though, discussions about the future of monetary policy likely took place. Analysts will look for clues about the next steps of the Central Bank. The volatility of the US dollar is likely to rise near 18:00 GMT, when the document will be published. 

AUD/USD Key levels 

Today’s rally could signal that an interim low in the AUD/USD pair was reached yesterday near 0.7800. If that is the case, the current move could extend to the 20-day moving average located at 0.7920/30 while a daily close significantly above 0.7900/10 could give support for the Aussie for an approximation to 0.8000. 

To the downside, a reversal back below 0.7840 from current levels, would expose the 0.7800 handle. A break lower could clear the way for a test of the key strong support at 0.7740.