AUD/USD clings to gains near multi-week tops, just below 0.6900 handle
|- Trump’s decision to delay additional tariffs on Chinese products provided a strong boost.
- Surging US bond yields continue to underpin the USD and kept a lid on any further up-move.
- Traders now look forward to the ECB decision/US CPI figure for short-term opportunities.
The AUD/USD pair held on to its strong intraday gains through the early European session on Thursday and is currently placed at multi-week tops, around the 0.6885 region.
After the previous session's late pullback, the pair managed to catch some fresh bids on Thursday and remained well supported by encouraging US-China trade developments. The US President Donald Trump announced to delay the decision to impose an extra 5% tariffs on $250 billion worth of Chinese goods by two weeks to Oct. 15, which eventually underpinned the China-proxy Australian Dollar.
US-China trade optimism continues to underpin
The move came after China on Wednesday offered to buy more US agricultural products and continued boosting the global risk sentiment, which was evident from a bullish trading sentiment around equity markets and further benefitted perceived riskier currencies - like the Aussie.
Meanwhile, the risk-on mood allowed the US Treasury bond yields to extend its recent positive momentum, pushing the US 10-year yield to one-month highs, which extended some support to the US Dollar and turned out to be the only factor keeping a lid on any strong follow-through up-move, at least for the time being.
It will now be interesting to see if the pair is able to capitalize on the momentum or runs into some fresh supply at higher levels as investors start repositioning for Thursday’s ECB monetary policy decision. This coupled with the release of the US consumer inflation figures will influence the USD price dynamics and contribute toward producing some meaningful trading opportunities.
Technical levels to watch
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.