Aussie fails to take advantage of broader USD sell off
|The Australian Dollar maintained a relatively tight trading handle through Thursday struggling to break back above 0.74 U.S Cents yet finding support on moves approaching 0.7350. The AUD bounced between short formed support and resistance for much of session with little macroeconomic data driving direction risk sentiment continued to drive broader corrections. While moves toward 0.7350 were seemingly well supported and the AUD bounced of intraday lows at 0.7346 upside gains were capped as the Aussie failed to mount meaningful upside pressure and followed equities lower.
Despite a pullback in U.S Treasury yields and a broader USD correction, the AUD remains vulnerable as long as tariffs and trade remain front and center. Long considered a proxy for broader risk appetite and Chinese sentiment the AUD is being weighed down by the heightened trade tension between the US and China with upside gains very much dependent on risk demand.
Attentions now turn to crucial US GDP number next week as the next bi ticket macroeconomic driver with trade and political tensions continuing to govern broader flows. Having broken comfortably through 0.7430 and 0.74 a close below those handles this week consolidates the downward correction and could see support form as resistance moving into H2 2018.
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