AUD/CAD traded slightly higher on Wednesday, after hitting support at around 0.9345 on Tuesday. The rate is trading above a tentative upside support line drawn from the low of June 3, and is now testing the key resistance of 0.9390, marked by the highs of June 7, 11, and 14. With that in mind, we would like to wait for a clear close above that barrier before we get confident on decent upside extensions.
A clear close above that hurdle will confirm a forthcoming higher high and may pave the way towards the peaks of May 14 and 17, at around 0.9430. If the bulls are not willing to stop there, then the advance may continue towards the 0.9470 or 0.9500 zones, marked by the inside swing lows of May 10 and 11, and the high of May 11, respectively. Another break above 0.9500 could see scope for extensions towards the 0.9555 obstacle, defined as a resistance by the high of May 10.
Shifting attention to our short-term oscillators, we see that the RSI runs above its trigger line, pointing up, while the MACD lies fractionally above both its zero and trigger lines, pointing slightly up as well. Both indicators suggest that the rate could start gathering upside speed soon, which supports the notion for further advances. However, we insist to wait for a clear break above 0.9390 before getting confident on that front.
On the downside, a dip below 0.9345 would also take the rate below the aforementioned upside line and may encourage the bears to push the action towards the 0.9300 barrier, marked by the low of May 28, or the 0.9255 zone, marked by the low of June 3. If neither territory is able to halt the decline, then a break lower would confirm a forthcoming lower low on the daily chart and may set the stage for the 0.9200 area, defined as a support by the inside swing high of May 26, 2020.