AUD/USD has taken back all of its losses and then some following its short-lived collapse on White House trade adviser Peter Navarro's comments overnight nL1N2DZ160, and the pace of the rebound may leave bulls in fear of missing out nL1N2DZ160.
AUD/USD dip buyers had been hoping for a deeper correction in the March-June rally, but the Navarro-driven drop, though sharp, was short, stalling near the 21-day moving average and old trend-line resistance-turned-support.
Attempts to walk back the comments drove investors out of safe havens assets and into riskier plays like equities, commodities and emerging markets currencies, pushing USD/CNH down near 7.0500.
That fueled the AUD/USD recovery, while upbeat June PMIs from Australia nZRN000K2H, the U.K. nL8N2DZ4DR and euro zone nL8N2E01LC gave the aussie further fuel.
Dovish comments from San Francisco Federal Reserve President Mary Daly nU5N2BQ00V helped soften U.S. rates and the dollar, fueling AUD/USD's rise above the 10-DMA and toward 0.6975/80 resistance.
AUD/USD had been consolidating in the 0.6775/0.7070 range, and a test of the range top looks likely.
A break would indicate a resumption of the broader rally.
That could force the FOMO crowd to jump back in, bolstering the rally for a potential assault on 0.7480/0.7520.
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