AUD/USD gains traction for the fourth straight day and climbs to over a one-month top.

• A sustained strength above the 100-day SMA supports prospects for additional gains.
• A convincing break below the 0.6600 mark is needed to negate the positive outlook.

The AUD/USD pair scales higher for the fourth successive day on Tuesday - also marking the eighth day of a positive move in the previous nine - and jumps to over a one-month high during the early part of the European session. The pair currently trades near the 0.6770-0.6775 region, up nearly 0.35% for the day, and seems poised to prolong its recent strong recovery move from the YTD low touched on May 31.

Firming expectations that the Federal Reserve (Fed) will skip hiking interest rates in June trigger a fresh leg down in the US Treasury bond yields and exert some downward pressure on the US Dollar (USD). Apart from this, a generally positive tone around the equity markets further undermines the safe-haven Greenback. This, along with the Reserve Bank of Australia's (RBA) surprise 25 bps rate hike last week and a more hawkish policy statement, continues to boost the risk-sensitive Aussie and acts as a tailwind for the AUD/USD pair.

From a technical perspective, the overnight close above the 100-day Simple Moving Average (SMA) was seen as a fresh trigger for bullish traders. The subsequent move up on Tuesday validates the constructive setup, which, along with positive oscillators on the daily chart, support prospects for a further near-term appreciating move. Hence, some follow-through strength beyond the 0.6800 mark, towards testing the May monthly top around the 0.6815-0.6820 region, looks like a distinct possibility ahead of the release of the US consumer inflation figures.

On the flip side, the 100-day SMA, currently pegged around the 0.6735-0.6730 area, now seems to act as immediate support ahead of the 0.6700 mark. This is closely followed by the very important 200-day SMA, currently around the 0.6680 area, which if broken might prompt some technical selling and make the AUD/USD pair vulnerable. Spot prices might then accelerate the fall further below the 0.6645 intermediate support, towards retesting the 0.6600 round-figure mark. A convincing break below the latter will shift the bias in favour of bearish traders