AUD/USD: spikes to fresh weekly highs on the 0.76 handle, but still needs to do more

Currently, AUD/USD is trading at 0.7620, up 0.49% on the day, having posted a daily high at 0.7624 and low at 0.7577.

Economic wrap: FOMC remained on hold - Westpac

AUD/USD has rallied through and onto the 0.76 handle marking fresh highs for the year and indeed since Nov of last year. The move is significant, breaking down the resistance barriers and giving way to optimism towards a full recovery of the November 2016 downtrend commencing at 0.7770, albeit with some way to go yet. Crucially, the Aussie has performed even vs the backdrop of a long dollar market and decent data from the US economy overnight. This is because the Australian Trade balance for December arrived in at a massive surplus of AUD3,511m vs the expected AUD2bn surplus. 

Australia's trade balance surplus surges in Dec

Meanwhile, we look ahead to the nonfarm payrolls data this week and also CNY Caixin Manufacturing PMI as next significant data. The US data overnight was positive and could be an indication for what to expect in Friday's jobs numbers. 

AUD/USD levels

The analysts at Commerzbank explained, however, "Only above 0.7645 will introduce scope to the 0.7778/.7850 2016 highs and the 38.2% retracement. Currently, the market’s dip lower is indicated to terminate circa 0.7505/.7435. We suspect that prices will need to go sub 0.7400, the 55 day ma, to alleviate upside pressure and trigger losses to 0.7312/00 then 0.7161/64, the recent lows."