AUD/USD: Pullback from 12-day top pauses above 0.6350 amid risk reset
|- AUD/USD remains mostly quiet after stepping back from the multi-day top.
- US diplomats tried to convince traders of recovery, House passes a $484 billion aid package.
- China blamed for the coronavirus outbreak, Gilead’s Remdesivir fails in the first trial.
- A light economic calendar keeps the virus update in the driver’s seat.
Having stepped back from the multi-day top, AUD/USD seesaws near 0.6370 during the initial Asian session on Friday. In doing so, the Aussie pair reflects the market’s risk reset amid a set of mixed news from the US.
A mixed feeling…
While upbeat comments from US President Donald Trump and Vice President Mike Pence suggests nearness to the economy’s re-open, the passage of $484 billion coronavirus (COVID-19) aid package by the House flash positive signals for the markets.
On the contrary, US Secretary of State Mike Pompeo and the White House Adviser Larry Kudlow ramped up allegations on China for the virus outbreak whereas initial failures of Gilead’s Remdesivir also stand on the negative side.
That said, the market’s risk-tone remains sluggish by the press time, with the S&P 500 Futures declining 0.40% to 2,770 at the start of Friday’s trading session. It should be noted that Wall Street marked struggled for direction and the US 10-year Treasury yields remained mildly positive by the end of Thursday.
Earlier, the US Jobless Claims came in better than forecast, but still in the higher range, while global PMIs, including that from the US, continued to disappoint markets.
In the case of Australia, preliminary readings of trade managed to mitigate the risks due to the downbeat PMI data. It should also be noted that the Pacific nation’s ability to better combat the pandemic, as inferred from the PM’s note, added strength to the Aussie the previous day.
Moving on, a lack of major data during the Asian session seems to restrict the moves but the virus updates will remain as the key.
Technical analysis
Unless closing below a 21-day EMA level of 0.6285, AUD/USD is likely to keep aiming for the monthly top surrounding 0.6445.
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