The Australian dollar continues to keep to a bid tone against its rival, the greenback, after posting its highest level in three years at US$0.7934 on Tuesday.
The US Dollar Index measures the greenback strength against a basket of major currencies, slid to an intraday low at 89.83.
The precious yellow metal (gold), also recovering above the $1,800 level, has helped the bullish advance, while rising commodity prices have also assisted to the AUD/USD upside move.
Iron ore, one of Australia’s main exports, is trading near 10-year highs after future benchmark prices surged late last week as Chinese markets reopened following the Lunar New Year holiday break.
Meanwhile, copper prices also rose last week as many investors are beginning to embrace a possible commodity bull cycle.
With the Australian economic calendar light, investors will closely watch U.S. Federal Reserve Chairman Jerome Powell when he delivers his semi-annual testimony on the economy before the Senate Banking Committee on Tuesday.
Viewing the technical assessment, as to what extent the bullish momentum can lift the AUD/USD is still uncertain.
However, we should not rule out a potential move to US$0.7960-65, with US$0.8015-25 to US$0.8100-44 viewed above.
The support holds from US$0.7830-40. Reassess from there.