AUD/USD seeks fresh clues to stay positive around mid-0.7700s


  • AUD/USD fades recent modest gains amid a lack of strong catalyst to the north.
  • Easing of US Treasury yields favored equities amid Fed policymakers’ attempt to reject reflation fears.
  • Virus, vaccine jitters continue ahead of the key Testimony from Fed Chair Powell and Treasury Secretary Yellen.

AUD/USD struggles to extend the latest recovery moves around 0.7750, recently easing from 0.7758 to 0.7745, amid the early Tuesday morning in Asia. The pair began the week on the back foot amid reflation fears but the easing of the US Treasury yields helped soothe the pains afterward. Though, a lack of major data/events, as well as pre-key catalyst cautious mood, seems to weigh on the quote off-late.

Inaction ahead of Powell-Yellen testimony…

Economic recovery hopes and the Fed’s readiness to let the Supplementary Leverage Ratio (SLR) concessions expire brightened the market mood on Monday, after a dismal start to the week on the coronavirus (COVID-19) and vaccine woes. Also helping the sentiment was the drop in the US Treasury yields and a lack of major negatives on the economic front. However, the optimism couldn’t last long as a mixed approach by the Treasury and the Fed keeps traders cautious ahead of this week’s testimony from Fed Chair Jerome Powell and Treasury Secretary Janet Yellen.

In a latest prepared remarks, to be repeated in front of the Congress, Fed Chair Jerome Powell said, Fed will continue to support the economy “for as long as it takes”. However, his comments on the employment and economic recovery suggest cautious optimism but fail to derail the latest positive performance of the markets.

On the contrary, the virus woes probe market bulls and so do the vaccine tussles between the European Union (EU) and the UK, not to forget geopolitical tension in the Middle East and the US-China tension.

Amid these plays, US 10-year Treasury yields dropped 3.7 basis points to revisit the sub-1.7% region after refreshing the multi-month top on Friday. The same helped Wall Street benchmarks to close Monday’s trading on a positive side.

Looking forward, AUD/USD traders will seek clues to confirm no challenges to easy money policy amid a dearth of data/events at home. In doing so, today’s testimony from Powell and Yellen will be the key.

Technical analysis

AUD/USD sellers can stay hopeful unless refreshing the early month top near 0.7840 while 21-day EMA close to 0.7755 guards immediate upside. On the contrary, the 50-day EMA around 0.7720-15 and an ascending trend line from December 21, 2020, near 0.7670, adds to the downside filters.

Additional important levels

Overview
Today last price 0.7744
Today Daily Change 10 pips
Today Daily Change % 0.13%
Today daily open 0.7734
 
Trends
Daily SMA20 0.778
Daily SMA50 0.7742
Daily SMA100 0.7598
Daily SMA200 0.7356
 
Levels
Previous Daily High 0.7776
Previous Daily Low 0.7716
Previous Weekly High 0.785
Previous Weekly Low 0.7698
Previous Monthly High 0.8008
Previous Monthly Low 0.7562
Daily Fibonacci 38.2% 0.7739
Daily Fibonacci 61.8% 0.7753
Daily Pivot Point S1 0.7708
Daily Pivot Point S2 0.7682
Daily Pivot Point S3 0.7648
Daily Pivot Point R1 0.7768
Daily Pivot Point R2 0.7802
Daily Pivot Point R3 0.7827

 

 

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