The australian dollar made steady gains and rallied from the low of 0.7168 in the prior Asian session to the morning high of 0.7265 in Europe (+97 pips). The aussie rallied against the weaker US dollar on a combination of a few bullish fundamental factors and recent events:
1) The lower US dollar after the much awaited FOMC decision where the Fed left their interest rates unchanged which sent the US bond yields lower. (18:00 GMT 9/17)
2) RBA Governor Glen Stevens's optimistic comments: "It is pretty clear that the Australian economy is growing, could be faster, halfway through the recource sector line." (23:30 GMT 9/17)
3) Sovereign bonds surged post the FOMC news, with demand for higher yielding currencies such as the australian dollar and new zealand dollar.
4) The market still carries a significant short australian dollar position as short covering ensued at the 0.7150-0.7175 level post the FOMC is being digested by the market.
Resistance levels: 0.7269 55-DMA, 0.7275 NY FOMC high, 0.7300 Psychological high with option expires, 0.7320 Market Buy Stops, 0.7360 Aug 21 high.
Support levels: 0.7190, 0.7160, 0.7150, 0.7137 Sept 17 low, 0.7123 Sept 16 low.
Chart: WorldWideMarkets Alpha Trader