AUD/USD - Yield spread rises in AUD-positive manner

• Aussie holds above 50-day MA.
• AU-US yield spread widens, AUD/USD could test 200-day MA hurdle.

Despite the US tax reform optimism and the resulting rise in the Treasury yields, the AUD/USD pair is trading above the 50-day MA of 0.7659.

The resilience is not surprising, given the spread or the difference between the 10-year Aussie bond yield and the US Treasury yield has increased in the AUD-positive manner to 19 basis points (bps) today from the previous day's print of 12 bps.

The AUD favorable yield spread indicates the spot could rise to 200-day MA hurdle of 0.7692.

AUD/USD Technical Levels

FXStreet Chief Analyst Valeria Bednarik writes, "the pair seems to have found a comfort zone between 0.7630 and 0.7700 after recovering from a multi-month low of 0.7503, now waiting for the next catalyst that could determinate whether this latest recovery has been corrective or not. Short term, the pair retains its neutral stance for a fourth consecutive trading day, with the 4 hours chart showing that indicators have now settled around their mid-lines, as the price hovers below a horizontal 20 SMA.

Support levels: 0.7640 0.7600 0.7570

Resistance levels: 0.7700 0.7730 0.7770