AUD/USD: Bulls catch a breather around 0.7200 despite upbeat China PMI

  • AUD/USD seesaws around 0.7200 as China’s official PMIs flashed better than forecast figures for July.
  • Risk aversion gains further strength from virus woes, doubts over the US fiscal package.
  • Downbeat US GDP, dovish Fed exert additional pressure on the US dollar index.
  • Risk catalysts, US Chicago PMI, Michigan Consumer Sentiment Index in focus for fresh impetus.

AUD/USD eases to 0.7205, up 0.15% on a day, during the early Friday. The pair recently surged to the highest since February 2019 while touching 0.7215 mark. Though, the bulls seem to wait for a more strong push before challenging the two-year high even as China flashed welcome activity numbers for July.

China’s July month NBS Manufacturing PMI surged past-50.7 forecast and 50.9 prior to 51.1 whereas Non-Manufacturing PMI crossed 51.2 expectations with 54.2 figures.

Read: China's manufacturing PMI ticks higher to 51.1 in July

While AUD/USD fails to respect China's data, the pair buyers are likely watching the US dollar index (DXY) slump for fresh impetus. The greenback gauge refreshed the lowest since May 2018 before a few minutes.

Searching for the underlying reasons, we can say that the latest jump in the coronavirus (COVID-19)-led deaths from Texas and a rise in the pandemic numbers from China, coupled with the fears of more local lockdowns in the UK, hurt the market’s preference for the US dollar. Furthermore, a whopping 32.9% contraction in the US GDP also speaks loud for the US currency’s weakness.

Also adding to the risk-off mood could be the delay in the much-awaited phase 4 fiscal plan from the US and American President Donald Trump’s push for a delay in the November month’s Presidential Election.

Against this backdrop, US 10-year Treasury yields take rounds to the lowest since March whereas S&P 500 Futures rise 0.40% to 3,262 by the press time. However, stocks in Australia, Japan and China are down as we write.

Looking forward, traders will have to concentrate on the risk catalysts for fresh impetus while also waiting for the second-tier data from the US. Forecasts suggest, US Chicago Purchasing Managers’ Index (PMI) to recover from 36.6 to 43.9 whereas Michigan Consumer Sentiment Index could slip from 73.2 to 73.00 in July.

Technical analysis

The pair’s ability to cross April 2019 top surrounding 0.7210 enables it to attack the year 2019 high near 0.7300. However, overbought RSI may trigger fresh pullback in a case where AUD/USD prices slip below July 22 high near 0.7180.

additional important levels

Today last price 0.7204
Today Daily Change 9 pips
Today Daily Change % 0.13%
Today daily open 0.7195
Daily SMA20 0.7041
Daily SMA50 0.6923
Daily SMA100 0.6601
Daily SMA200 0.6697
Previous Daily High 0.7198
Previous Daily Low 0.712
Previous Weekly High 0.7184
Previous Weekly Low 0.6972
Previous Monthly High 0.7065
Previous Monthly Low 0.6648
Daily Fibonacci 38.2% 0.7168
Daily Fibonacci 61.8% 0.715
Daily Pivot Point S1 0.7144
Daily Pivot Point S2 0.7094
Daily Pivot Point S3 0.7067
Daily Pivot Point R1 0.7222
Daily Pivot Point R2 0.7249
Daily Pivot Point R3 0.7299



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

Latest Forex News

Editors’ Picks

EUR/USD recovers towards 1.1750 as risk-on rules

EUR/USD is back around 1.1750 as upbeat US data fueled equities' early rally. Concerns about economic progress remain in the background, as the pandemic keeps taking its toll. 


GBP/USD bounces from 1.30 as demand for the dollar eases

Dollar's corrective advance seems complete, now down against most major rivals. GBP/USD trades little changed for a second consecutive day in the 1.3060/70 price zone. Market players continue to ignore upcoming Brexit chaos.


Gold: Interesting Fibonacci extension projects a move to $2500

Gold has risen 10.74% in the month of July, the biggest monthly increase since February 2016. As the price is breaking all-time highs it's hard to say where the yellow metal could end up.

Gold News

ETH/BTC skyrocketing, Bitcoin stays above $11,000

The cryptocurrency market is influenced by leveraged positions liquidation. Cryptocurrency experts expect further growth amid a global flight to safety assets. ETH/BTC hits the highest level since May 2019.

Read more

WTI drops below $40 on demand worries, OPEC+ output increase

Crude oil prices posted losses last week and seem to be struggling to shake off the bearish pressure on Monday. As of writing, the barrel of West Texas Intermediate (WTI) was trading at $39.85, losing 1.5% on a daily basis.

Oil News