A cluster of highs and the 100 day MA loom above

The AUDUSD is currently breaking above a cluster of highs going back to January. Those highs range in between 0.7841 and 0.7858 (see chart below). The next target on the topside is the 100 day moving average at 0.7888 today. The price of the AUDUSD has not traded above the 100 day moving average since September 8, 2014. A break above should solicit more buying with 0.7912 (high from February 26) and 0.7937 (high from March 24) as the next upside targets. The 0.8030 area is also a level to eye on the topside. This corresponds with lows from early January and near a spike high from January 28.

Since February, there have and two separate attempts to get and stay above this collection of highs (yellow area in the chart below). The 1st look lasted one day before closing back below. The 2nd look in March was able to get to close above the area for two day. With the 100 day MA not far away, I would expect the market would look to put a serious test of the MA level, with additional stops on a move above.

In the back of trades minds, will be the June 5th RBA interest rate decision. The data of late has been better in Australia (employment and CPI). Nevertheless, according to interest rate futures there is a 50-50 chance for a cut. That, however, is less than what it has been forecast. So the picture is a bit mixed.

On the other side of the equation is the US and today, the data was once again on the weakish side. With weak 1Q GDP and the Fed scheduled on Wednesday (no change, no press conference, it will all be in any changes in the statement), if the Fed keeps the language the same, a move above the MA level might just be in the cards with the upper levels tested.