The Australian Dollar has made new highs after highs since the beginning of November. It seems that the trend may likely continue as 2021 approaches. This week’s jobs report provided a primer for the current move higher with the unemployment rate dropping to 6.8% from 7.0%. Strong economic data is likely dampening any dovish RBA prospects even as the central bank discourages a strong AUD.

Another driving factor behind the current AUD/USD strength is iron ore prices. The current contract in DCE iron ore futures is up nearly 4% today. Iron’s price surge is a huge boost for the Australian economy which is the largest exporter of the economically vital mineral substance. Surging spot prices are a welcome development to Australia’s economic budget amid a global pandemic.

AUD/USD TECHNICAL OUTLOOK:

Now at another fresh multi-year high, AUD/USD has broken above late 2019 trendline resistance. The upward momentum appears capable of pushing prices higherb However, the 23.6% Fibonacci retracement level from the October swing low to yesterday’s high may serve as a target on a pullback.

The recently broken trendline resistance may turn to new support given current enthusiasm. Overall, however, AUD/USD appears primed to continue higher without an underlying fundamental shift. MACD divergence has managed to extend on the most recent push higher and RSI remains well above the overbought 70 level.

Reference by: Thomas Westwater, Analyst for DailyFX.com