AUD/USD: Bulls cheer risk-on sentiment above 0.6500, RBA minutes in focus


  • AUD/USD catches a breather above 0.6500 after positing biggest gains in seven weeks.
  • Optimism surrounding virus vaccine, hopes of increase in China’s demand superseded US-China tussle.
  • Signals of additional easing from Fed, BOE and Europe also contribute to the market’s optimism.
  • RBA minutes become the immediate catalysts while virus headlines, US/China news can keep traders busy.

AUD/USD bulls keep the reins, despite catching a breather, as the pair seesaws around 0.6525/20 at the start of Tuesday’s Asian session. The pair registered the biggest gains, of around 1.7% daily, in seven weeks the previous day.

Virus medicine revives markets, central bankers/commodities support recovery…

Talks of Moderna’s early success in coronavirus vaccine trials propelled the market’s risk-on sentiment at the week’s start. The optimism also took clues from signals of further easing by the US Federal Reserve, the Bank of England (BOE) and Europe.

Also read: Coronavirus update: US death toll crosses 90K, Pres. Trump says he takes hydroxychloroquine everyday

Further, comments from Chinese President Xi Jinping that China’s COVID-19 vaccine development and deployment will be made a public good when it is available and a pledge to provide $2 billion over two years to support the fight against the virus also boosted the risk-positive environment.

Additionally, the Aussie pair also benefited from the upbeat performances of oil and gold prices. The expectations that China is back to pre-virus breakout levels of oil consumption fuelled energy prices whereas Gold also cheered the upcoming wave of easy money to the multi-year high.

It should also be noted that these positive catalysts weigh over the early week headlines concerning the US-China tussle and helped Wall Street to post noticeable gains by Monday’s close. Also portraying the market’s risk-on mood could be the strong run-up by the US Treasury yields and bunds.

Looking forward, RBA minutes, up for publishing at 01:30 GMT on Tuesday, will be the immediate catalyst to watch. With the Statement of Monetary Policy (SOMP) already out and loud, the minutes are less likely to gain any major attention. However, traders will be interested in seeking clues of further easing and economic performance due to the virus in the statement.

Following the RBA minutes, US housing market figures and the Fed Chair Powell’s testimony will be the key to watch.

Technical analysis

With a daily closing beyond 100-day SMA for the first time since late-January, AUD/USD seems to be ready to challenge April tops nearing 0.6570. Though, 0.6600 round-figure, 200-day SMA near 0.6665 and March high close to 0.6685/90 can question the bulls afterward. Meanwhile, pair’s drop below 100-day SMA level of 0.6512 will need a clear break below 0.6500 round-figure to recall Friday’s low of 0.6401.

Additional important levels

Overview
Today last price 0.6525
Today Daily Change 111 pips
Today Daily Change % 1.73%
Today daily open 0.6414
 
Trends
Daily SMA20 0.6436
Daily SMA50 0.6272
Daily SMA100 0.6517
Daily SMA200 0.6667
 
Levels
Previous Daily High 0.6474
Previous Daily Low 0.6401
Previous Weekly High 0.6562
Previous Weekly Low 0.6401
Previous Monthly High 0.657
Previous Monthly Low 0.598
Daily Fibonacci 38.2% 0.6429
Daily Fibonacci 61.8% 0.6446
Daily Pivot Point S1 0.6385
Daily Pivot Point S2 0.6357
Daily Pivot Point S3 0.6312
Daily Pivot Point R1 0.6458
Daily Pivot Point R2 0.6503
Daily Pivot Point R3 0.6531

 

 

Share: Feed news

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Recommended content


Recommended content

Editors’ Picks

EUR/USD stays near 1.0400 in thin holiday trading

EUR/USD stays near 1.0400 in thin holiday trading

EUR/USD trades with mild losses near 1.0400 on Tuesday. The expectation that the US Federal Reserve will deliver fewer rate cuts in 2025 provides some support for the US Dollar. Trading volumes are likely to remain low heading into the Christmas break.

EUR/USD News
GBP/USD struggles to find direction, holds steady near 1.2550

GBP/USD struggles to find direction, holds steady near 1.2550

GBP/USD consolidates in a range at around 1.2550 on Tuesday after closing in negative territory on Monday. The US Dollar preserves its strength and makes it difficult for the pair to gain traction as trading conditions thin out on Christmas Eve.

GBP/USD News
Gold holds above $2,600, bulls non-committed on hawkish Fed outlook

Gold holds above $2,600, bulls non-committed on hawkish Fed outlook

Gold trades in a narrow channel above $2,600 on Tuesday, albeit lacking strong follow-through buying. Geopolitical tensions and trade war fears lend support to the safe-haven XAU/USD, while the Fed’s hawkish shift acts as a tailwind for the USD and caps the precious metal.

Gold News
IRS says crypto staking should be taxed in response to lawsuit

IRS says crypto staking should be taxed in response to lawsuit

In a filing on Monday, the US International Revenue Service stated that the rewards gotten from staking cryptocurrencies should be taxed, responding to a lawsuit from couple Joshua and Jessica Jarrett.

Read more
2025 outlook: What is next for developed economies and currencies?

2025 outlook: What is next for developed economies and currencies?

As the door closes in 2024, and while the year feels like it has passed in the blink of an eye, a lot has happened. If I had to summarise it all in four words, it would be: ‘a year of surprises’.

Read more
Best Forex Brokers with Low Spreads

Best Forex Brokers with Low Spreads

VERIFIED Low spreads are crucial for reducing trading costs. Explore top Forex brokers offering competitive spreads and high leverage. Compare options for EUR/USD, GBP/USD, USD/JPY, and Gold.

Read More

Forex MAJORS

Cryptocurrencies

Signatures