AUD/USD prods four-day uptrend near 0.6700 on mixed Aussie data, China news, Fed Minutes eyed


  • AUD/USD struggles to extend four-day winning streak at the highest levels in a week.
  • RBA paused rate hike trajectory but kept Aussie bulls hopeful with hawkish statements.
  • Fears of ramping up US-China trade war challenge sentiment amid full markets, mid-tier Aussie data came in mixed.
  • Risk catalysts, FOMC Minutes are the key for fresh impulse.

AUD/USD justifies risk-barometer status as it pauses the four-day winning streak while making rounds to 0.6690 amid the early hours of Wednesday’s Asian session. In doing so, the Aussie pair takes clues from the risk-negative headlines surrounding China and mixed data from home.

Australia’s AiG Manufacturing PMI slumps to -19.8 for May from -5.1 prior but Construction PMI improves to 10.6 versus -6.6 previous readings. Further, the AiG Industry Index also slide to -11.9 during the said month from -10.9 marked in April. That said, the S&P Global Composite PMI eased to 50.1 in June compared to 50.5 previous readings whereas the Services PMI also declined to 50.3 from 50.7 expected and prior.

Further, Fears of the US-China trade war escalate and weighs on the sentiment as China announced abrupt controls on exports of some gallium and germanium products, effective from August 1. The dragon nation’s latest retaliation is in reaction to the US curb on AI chips’ shipments to Beijing.

Previously, the Wall Street Journal (WSJ) added to the market’s fears about the Sino-American ties while saying, “The Biden administration is preparing to restrict Chinese companies’ access to U.S. cloud-computing services, according to people familiar with the situation, in a move that could further strain relations between the world’s economic superpowers.”

On the same line, China’s President Xi Jinping said in a virtual SCO summit on Tuesday that they “should focus on practical cooperation and accelerate economic recovery. The policymaker also added, “(They) Need to strengthen strategic communication and coordination, respect each other's core interests and concerns.”

It should be observed that US Treasury Secretary Janet Yellen is in Beijing. Earlier on Tuesday, US Treasury Department said, per Reuters, “Treasury Secretary Janet Yellen had a 'frank and productive' discussion today with China's Ambassador.” The news also mentioned that US Treasury Secretary Yellen raised issues of concern while also conveying the importance of the two countries working together.

On Tuesday, the Reserve Bank of Australia (RBA) surprised markets by keeping the benchmark rates unchanged at 4.10%, versus expectations of a third consecutive rate hike of 25 basis points. However, the Aussie central bank also said, “Some further tightening of monetary policy may be required,” while adding that any tightening will depend upon how the economy and inflation evolve.

AUD/USD initially fell in reaction to the RBA’s status quo before regaining the upside momentum that allowed the Aussie pair to portray a four-day winning streak, as well as refresh a one-week high.

Against this backdrop, the US Dollar printed a two-day winning streak before ending Tuesday’s North American session near 103.10 whereas the German Bunds rose while Euro Stoxx and FTSE 100 were both down with mild losses.

Looking ahead, the risk catalysts will be crucial to determine near-term market directions as the US traders return after a break. Also important to watch will be the Federal Open Market Committee (FOMC) Minutes for the June meeting when the Fed policymakers announced a pause on the rate hike. Additionally important will be China Caixin Services PMI for June.

Technical analysis

Although the 200-DMA challenges AUD/USD bulls around the 0.6700 round figure, pullback remains elusive unless breaking the previous resistance line stretched from June 16, close to 0.6585 at the latest.

Additional important levels

Overview
Today last price 0.6692
Today Daily Change 0.0020
Today Daily Change % 0.30%
Today daily open 0.6672
 
Trends
Daily SMA20 0.6732
Daily SMA50 0.6673
Daily SMA100 0.6697
Daily SMA200 0.6693
 
Levels
Previous Daily High 0.6692
Previous Daily Low 0.6637
Previous Weekly High 0.6721
Previous Weekly Low 0.6595
Previous Monthly High 0.69
Previous Monthly Low 0.6484
Daily Fibonacci 38.2% 0.6671
Daily Fibonacci 61.8% 0.6658
Daily Pivot Point S1 0.6642
Daily Pivot Point S2 0.6612
Daily Pivot Point S3 0.6588
Daily Pivot Point R1 0.6697
Daily Pivot Point R2 0.6722
Daily Pivot Point R3 0.6752

 

 

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

AUD/USD struggles near multi-month low below 0.6500 after Aussie jobs report

AUD/USD struggles near multi-month low below 0.6500 after Aussie jobs report

AUD/USD hangs near its lowest level since August 6 below the 0.6500 level following the release of rather unimpressive Australian employment details for October. Meanwhile, RBA Governor Michele Bullock said earlier on that interest rates were restrictive enough and will not rise any further. 

AUD/USD News
USD/JPY briefly pops 156.00 on firmer US Dollar

USD/JPY briefly pops 156.00 on firmer US Dollar

USD/JPY holds firm near its highest level since July 24, having briefly popped 156.00 in the Asian session on Thursday. The continuation of the Trump trade lifts the US Dollar to yearly highs while Japan's stimulus plans fail to inspire the Yen. Traders watch out for any Japanese internvetion risks.  

USD/JPY News
Gold downside appears unabated, with eyes on Fed Chair Powell

Gold downside appears unabated, with eyes on Fed Chair Powell

Gold price is sitting at its lowest level in two months near $2,560 early Thursday, as buyers eagerly await US Federal Reserve Jerome Powell’s speech for a brief respite.

Gold News
XRP's open interest drops over 10% amid struggles near $0.7440 resistance

XRP's open interest drops over 10% amid struggles near $0.7440 resistance

Ripple's XRP is trading near $0.6900, down nearly 3% on Wednesday, as declining open interest could extend its price correction. However, other on-chain metrics point to a long-term bullish setup.

Read more
Trump vs CPI

Trump vs CPI

US CPI for October was exactly in line with expectations. The headline rate of CPI rose to 2.6% YoY from 2.4% YoY in September. The core rate remained steady at 3.3%. The detail of the report shows that the shelter index rose by 0.4% on the month, which accounted for 50% of the increase in all items on a monthly basis. 

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