The Australian dollar held fort at three-week highs above $0.9000 on Wednesday, aided by a perkier mood in markets, expectations of more rate rises at home and a pause in the euro's recent slide. But the currency's resilience was accompanied by thin trading volumes, leading some traders to suspect it may easily succumb to a change in sentiment, especially with the Greek debt crisis still unresolved.
Reuters data showed trading volumes for the Aussie were at their lowest in over a month. "The question now is whether the sharp move overnight can continue," said David Scutt, a trader at Arab Bank Australia. "No one is really prepared to go one way or the other."
The Aussie was firm at $0.9011, up from $0.8934 seen here late Tuesday. Most of the gains were made offshore when a weaker US dollar, higher US stocks and commodity prices helped at the margins. For now, near-term resistance is layered from $0.9050 to the 100-day moving average at $0.9063 and then $0.9085. Against the euro, the Aussie shied away from decade highs, held back in part by a bounce in the common currency. The euro bounced to A$1.5276, off Tuesday's decade low of A$1.5188.