AUD/USD technical analysis: Peeps above 23.6% Fib, hits highest since May 14

• AUD/USD rises above key Fib level.
• RBA rate cut priced in.
• Trump rules out tariffs on Australia.

AUD/USD is on the rise a day ahead of the Reserve Bank of Australia rate decision.

At press time, the currency pair is trading well above 0.6943, which is the 23.6% Fibonacci retracement of the sell-off from 0.7206 to 0.6865.

The spot hit a high of 0.6960 soon before press time - the level last seen on May 14.

With the 5- and 10-day moving averages (MAs) beginning to trend north and the 14-day relative strength index (RSI) rising to 50.00 (neutral level), the short-term technical profile is looking bullish.

As a result, the pair may rise further toward 0.6996, which is the 38.2% Fibonacci retracement of the sell-off from 0.7206 to 0.6865.

The bullish case looks stronger if we take into account the news that the US President Trump has decided against tariffs on Australia. Further, China's Caixin PMI released earlier today showed the manufacturing activity in the world's second-largest economy held up well in May despite the re-escalation of trade tensions.

What's more, the markets have fully priced in the possibility of the RBA cutting rates by 25 basis points to a new record low of 1.25 percent on Tuesday.

Daily chart

Trend: Bullish

Pivot levels