AUD/USD prints five-day uptrend near 0.7600 despite local lockdowns in Australia
|- AUD/USD reverses early Asian pullback, snaps two-week south-run.
- DXY shrugs off upbeat Treasury yields, some parts of Sydney witness virus-led activity restrictions.
- Biden’s stimulus battles Fed’s removal of limits on large banks, Aussie-China tussles continue.
- Lackluster day envisioned amid light calendar, end of key events.
AUD/USD refreshes intraday high with 0.7594, up 0.11% on a day, during the five-day uptrend portrayed early Friday. The risk barometer recently cheered US dollar weakness, backed by the market’s optimism, while ignoring news of local lockdowns in Sydney.
The Fed’s removal of share repurchases and dividend limits from the large banks, introduced amid the pandemic, initially weighed on the risk appetite as traders took it as a hidden measure of recalling the easy money reliefs. However, the second reading suggests that the same will help market players to better cheer the economic recovery and helped restore the sentiment of late.
Earlier, US President Joe Biden’s ability to deliver $569 billion of infrastructure spending plan favored the market’s mood and weighed on the US dollar. Also on the same line were mixed US economics and Fedspeak that keeps rejecting the tapering and rate hike concerns.
Additionally, an update from the Securities Times, suggesting China may increase fiscal policy support in H221 to meet its budget deficit goal, and accelerate local bond issuances to boost infrastructure investment also favor AUD/USD bulls.
Even so, the West versus China tussles and fears of the Delta variant of the coronavirus (COVID-19) keep AUD/USD buyers in check. The latest announcement of activity restrictions in Australia’s Sydney City, Woollahra, Waverley and Randwick portray the covid woes.
Amid these plays, the US 10-year Treasury yields remain up for the third consecutive day and S&P 500 Futures also print mild gains.
Moving on, a lack of major data/events can keep AUD/USD traders troubled ahead of the US session wherein the second-tier readings may entertain the bulls.
Technical analysis
AUD/USD remains above the 200-DMA level of 0.7561, suggesting further advances toward the 0.7600 threshold ahead of confronting the early month low near 0.7640-45 area.
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