AUD/USD: Bears catch a breath around 4-week low


  • Risk sentiment remains heavy amid trade, geopolitical pessimism.
  • Sluggish data increases expectations of RBA’s another rate cut.

With fewer catalysts to dominate than the global trade pessimism, the AUD/USD pair takes the rounds near 0.6870 during the early Asian session on Monday.

During last week, the Aussie pair couldn’t benefit from China’s upbeat data as higher than expected unemployment rate at home continues to signal another rate cut from the Reserve Bank of Australia (RBA).

Being a commodity-linked currency, the Australian Dollar’s (AUD) buyers were also disappointed to see increasing trade tussle between the US and China dimming prospects of any solution when the leaders of both the countries meet at the sidelines of G20.

Further, rising US Dollar (USD) and pessimism surrounding the global economy backed by the US-China trade tussles and geopolitical tension amid the US and Iran also played their role to drag the Aussie pair downwards.

Global risk barometer, the 10-year yield of the US government bond, slipped to late 2017 lows near 2.08% amid challenges to investor sentiment.

Looking forward, traders can keep emphasizing on the US-China trade developments due to lack of major data/events on hand whereas the momentum of the greenback and global risk could also offer fresh clues to determine near-term moves.

Technical Analysis

A sustained break of 0.6860 becomes pre-requisite for the bears to aim for 2016 lows around 0.6830 and then aim for January month’s flash crash bottom near 0.6730.

On the contrary, an uptick beyond May 30 low of 0.6900 can trigger the pair’s pullback to 0.6940 and 0.6970 numbers to the north.

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.

Feed news

FXStreet Trading Signals now available!

Access to real-time signals, community and guidance now!


Latest Forex News

Editors’ Picks

EUR/USD chops around amid end-of-month flows, ahead of Trump

EUR/USD is battling 1.11, close to the two-month highs amid choppy trading. Hopes for a fiscal boost in Europe and mixed satisfactory data have supported the currency pair. , Sino-American tensions are rising and investors await President Trump's China announcement.

EUR/USD News

GBP/USD advances amid US dollar weakness, shrugging off concerns

GBP/USD is trading above 1.23, edging higher amid US dollar weakness and Britain's gradual reopening. Intensifying Sino-American tensions and the Brexit impasse are ignored. 

GBP/USD News

Cryptocurrencies: $348M in matured derivatives boost the market

Futures and options contracts' expiration brings a wave of volatility to the crypto market. Ethereum takes advantage and attacks resistances in the market dominance chart, Bitcoin goes back. Ripple disappoints despite regaining the third place in market capitalization.

Read more

Canada's economy falls by 8.2% annualized in Q1, better than expected, USD/CAD shakes

The Canadian economy squeezed by an annualized rate of 8.2% in the first quarter of 2020, better than -10% expected. Quarterly, Gross Domestic Product (GDP) squeezed by 2.1%. Most of the downfall occurred in March, with a drop of 7.2%, better than 8.5% projected. 

Read more

WTI drops 4% and eyes $32 mark amid risk-off, weakening demand

The selling pressure around WTI (July futures on Nymex) accelerates following the break below the 33 level, as bears now target the 32 support zone heading into the key US macro data and US President Donald Trump’s response to the Hong Kong issue.

Oil News

Forex MAJORS

Cryptocurrencies

Signatures