AUD / USD remains stable at multi-week highs above 0.7250

• AUD / USD consolidates above 0.7250 after a 3.6% weekly advance.
• Post-election risk spike has boosted the AUDThe Australian dollar is facing stiff resistance at 0.7300.

The bearish reversal of AUD from the six week highs at 0.7290 witnessed the previous Friday it has been contained at 0.7200 and the pair rebounded again to consolidate above 0.7250 approaching the weekly close.

Australian dollar recovers after US elections

AUD / USD has seen its best week in recent months, with the pair set for a 3.6% weekly gain, driven by the post-US election risk rally. The prospects of a Democratic government with the Republican-controlled Senate to block big spending plans or any attempts to raise taxes have been welcomed by investors who have sent equity markets higher and the safe-haven US dollar a minimums of several months.

The better-than-expected US Non-Farm Payroll report, which showed a 638,000 increase in employment in October, beating expectations for a 600,000 increase has provided mild support to the dollar. The pair fell to session lows at 0.7230 after the employment report was released, although it managed to cut losses soon after.

AUD / USD faces stiff resistance at 0.7300 – UOB

From a technical point of view, the UOB currency strategy team warns of a major resistance area at 0.7300: “While the main resistance at 0.7300 is still intact (overnight high of 0.7289), the strong Increase in momentum (AUD closed higher by a whopping + 1.49%) indicates that 0.7300 is unlikely to sustain the current AUD advance. That said, there is another strong resistance at 0.7345 and only a clear breakout of this level would indicate that the AUD is ready to challenge the year-to-date high at 0.7413 ”.