AUD/USD Price Forecast: Extends recovery to near 20-day EMA

The Australian Dollar (AUD) has shown significant strength against major currencies, including the US Dollar (USD), on Wednesday. Trading at around 0.7010, the AUD has gained 0.3% during the European session. This positive movement comes after the Reserve Bank of Australia (RBA) revealed its minutes from the September meeting, signaling a readiness to hike interest rates further this year.

The minutes highlighted the RBA's preparedness to consider additional rate hikes if needed, even though they had already increased the policy rate by 100 basis points this year. Additionally, the RBA expressed concerns that a decline in house prices could impact household spending more than initially anticipated, supporting arguments for maintaining stable interest rates.

Analysts noted that the Australian Dollar performed particularly well against the Swiss Franc. Currently, AUD/USD is trading at 0.7007, having extended its recovery to near the 20-day Exponential Moving Average (EMA) at 0.7011. While the Relative Strength Index (RSI) indicates moderating but still fragile downside momentum, the pair remains under pressure at the 20-day EMA level, suggesting bulls must regain this support to alleviate current resistance.

The key support level to watch is the October 13 low at 0.6987, with further declines potentially targeting the October 1 low at 0.6904.