The Australian dollar continued its rebound against the US dollar during Wednesday's European trading session, rising to around 0.7170. Overall, the Australian dollar performed relatively strongly among major currencies, indicating a significant recovery in market risk appetite.

From a market perspective, improved risk sentiment is one of the core factors driving the Australian dollar's strength. With signs of a temporary easing in the Middle East situation and the US extending the ceasefire, market concerns about further escalation of the conflict have diminished. This shift has increased investor appetite for risk assets, driving capital inflows into high-yield and cyclical currencies. A rebound in risk sentiment typically benefits commodity currencies like the Australian dollar , becoming a significant driver of exchange rate increases.

Market performance, with risk assets strengthening in tandem, confirms this trend. S&P 500 futures rose to approximately 7110 points , reflecting increased investor confidence in the economic outlook. Against this backdrop, funds flowed from safe-haven assets to equity markets and commodity currencies, further supporting the Australian dollar's performance.

Meanwhile, a weaker US dollar provided additional support for the Australian dollar. The US dollar index fell back to around 98.25 , indicating a weakening relative advantage among major currencies. The dollar's pullback reduced the relative depreciation pressure on the Australian dollar , allowing the Australian dollar to continue its rebound against the US dollar.

From a data perspective, the market is awaiting the upcoming Purchasing Managers' Index (PMI) data. This data will reflect the activity levels of the manufacturing and service sectors and is crucial for assessing economic momentum. Strong data could further bolster market confidence in the economic recovery, thereby supporting the performance of risk assets.

From a technical perspective, the daily chart shows that the Australian dollar against the US dollar maintains a healthy upward structure. The price continues to trade above the 20-day exponential moving average, which is located at 0.7081 and forms key support , indicating that bullish forces remain dominant. Since the March lows, the exchange rate has gradually risen, forming a stable upward trend.

In terms of momentum indicators, the RSI is running around 63, which is in the bullish zone but has not yet entered the overbought zone, indicating that there is still room for upward momentum; the MACD remains above the zero line, and the current trend is bullish.

From a 4-hour chart perspective, the exchange rate is showing a steady upward trend with limited short-term pullbacks, indicating strong buying support. If the price continues to hold above 0.7150, it is expected to further test the key resistance level of 0.7222 , which is a recent important high. A break above this level could open up new upside potential.

However, the support level below is also worth noting. A break below the 0.7080 area could trigger a deeper correction, potentially even a retest of the psychological level of 0.7000 . Currently, as long as the price remains above the key moving averages, the overall upward structure is expected to hold.

Overall, the Australian dollar is currently in a favorable environment of "improved risk sentiment + weakening US dollar", and its short-term trend is relatively strong.

Editor's Summary : The Australian dollar continued its rebound against the US dollar, driven by both improved risk appetite and a weaker US dollar, with the technical indicators showing a solid bullish structure. In the short term, the market will focus on PMI data and changes in global risk sentiment. If the risk environment continues to improve, the exchange rate is expected to rise further to test key resistance areas. However, the risk of a pullback due to weaker-than-expected data or weakening sentiment should be noted.