EASING BORDER RESTRICTIONS TO UNDERPIN AUD
The Australian Dollar has stormed higher in the month of November, climbing over 5% against the US Dollar to come within a stone’s throw of the yearly high set in September.

Prices look set to surpass this peak in the near term, as the nation’s successful suppression of the novel coronavirus allows states to roll back border restrictions.

The border between Australia’s two most populous states – Victoria and New South Wales – was reopened on November 23 after being closed for over 4 months, while Queensland Premier Annastacia Palaszczuk announced yesterday that “on December 1, Victorians can also come to Queensland and Queenslanders can go to Victoria as well”.

These moves will likely bolster the heavy-hit tourism, travel and services sectors ahead of the holiday season. Indeed, Flight Centre has registered a record increase in domestic travel bookings while Qantas – Australia’s national carrier – has added hundreds of extra flights to cope with the surge in demand.

To contrast, Germany has extended its nationwide partial lockdown for at least three weeks while Covid-19 hospitalizations in the US skyrocket to just under 90,000, surpassing the peaks seen in April and July by over 25,000.

This stark divergence in health outcomes may put a premium on the Australian Dollar, if the nation can successfully open borders without triggering a fresh outbreak in coronavirus cases.

AUD/USD DAILY CHART – YEARLY HIGH WITHIN REACH
From a technical perspective, AUD/USD rates look poised to challenge the yearly high, after slicing through key psychological resistance at 0.7300.

With the RSI eyeing a push into overbought territory and the MACD indicator storming to its highest levels since early September, the path of least resistance seems to favour the upside.

Ultimately, a daily close above the September high (0.7413) is needed to signal a resumption of the uptrend extending from the March nadir and open the door for prices to challenge the 78.6% Fibonacci (0.7573).

Conversely, slipping back below September 16 high (0.7345) could neutralize near-term buying pressure and generate a pullback towards confluent support at the 100-day moving average and 61.8% Fibonacci (0.7131).

Reference by: Daniel Moss, Analyst for DailyFX