AUD/USD ignores strong China Caixin Services PMI ahead of RBA rate decision
|- AUD/USD keeps retreat to the mid-0.7600s despite upbeat China activity numbers.
- China Caixin Services PMI jumps to 54.3 in March, Aussie ANZ Job Advertisements rose as well.
- Risk dwindles amid a lack of major directives but bears’ aren’t invited.
- RBA may sound optimistic while conveying monetary policy inaction, though bonds, employment are the keywords to follow.
AUD/USD pauses pullback from intraday top of 0.7662 around 0.7650 during early Tuesday. In doing so, the Aussie pair takes clues from China’s Caixin Services PMI data for March but cautious sentiment ahead of the RBA probes the recovery moves.
China’s Caixin Services PMI differs from the Caixin Manufacturing PMI while rising to 54.3 versus 51.7 market consensus and 51.5 previous readouts. Earlier in the day, Australia’s March month ANZ Job Advertisements grew past-7.2% prior (revised to 8.8% afterward) to 7.4%.
Read: China's Caixin Services PMI unexpectedly jumps to 54.3 in March, AUD/USD uninspired
Other than the wait for the RBA, the shift in the market sentiment also challenges AUD/USD upside. The market seems to consolidate the previous day’s gains as the latest recent headlines from the UK and Japan tests the optimism. Among them, the UK’s signals to restrict the AstraZeneca vaccine for young people join Japan’s fears of a rate cut and the probable economic imbalances.
On the contrary, New Zealand’s opening of national borders with Australia and recovering coronavirus (COVID-19) conditions at home test the bears.
Amid these plays, S&P 500 Futures ease 0.10% intraday from the record top, flashed the previous day, to 4,064. Though, the US 10-year Treasury yields drop below 1.70%, down 3.4 basis points (bps), by the press time.
After witnessing the initial reaction to the upbeat activity numbers from Australia’s biggest customer, AUD/USD traders will keep their eyes on the Reserve Bank of Australia’s (RBA) monetary policy meeting decision for fresh impulse.
Read: When is the RBA Interest Rate Decision and how could it affect AUD/USD?
Technical analysis
The 0.7560-55 support zone comprising the neckline of the short-term head-and-shoulders becomes the key to watch during the AUD/USD pullback moves. Meanwhile, a daily closing beyond 100-day SMA, around 0.7640, enables AUD/USD buyers to keep their eyes on the mid-March low surrounding the 0.7700 threshold.
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