- Greenback declines, comments from RBA’s Lowe help the Aussie pair to remain strong near the 2-week top.
- Trade developments, RBA’s Bullocks will be followed for fresh impulse.
Extending its week-long upward trajectory, the AUD/USD pair is trading near a fortnight top while quoting 0.6966 amid the early Asian session on Tuesday.
In addition to the general US Dollar (USD) weakness, comments by the Reserve Bank of Australia’s (RBA) Governor Phillip Lowe that monetary policy easing is unlikely to be as effective as in the past also played its role to portray the Aussie pair as the best G10 performer on Monday.
The US and China continue to flash mixed signal considering their leaders’ trade meet at the upcoming G20. However, the break of the negotiation deadlock is something that becomes a surety.
Market risk sentiment tilts downwards amid fears of global pessimism requiring excess monetary easing from major central banks. The US 10-year treasury yield, a macro indicator for risk tone, lost nearly 3 basis points during the week while clocking in 2.018% by the day’s start.
The economic calendar remains light with RBA’s Assistant Governor (Financial System) Michele Bullock’s speech likely being an immediate catalyst ahead of the US Consumer Confidence and New Home Sales data. During the end part of the day, the US Federal Reserve Chairman Jerome Powell is also scheduled for a speech from the Council on Foreign Relations, in New York.
Investors will keep looking for signs of policy easing from the RBA and the Federal Reserve members whereas second-tier data could offer intermediate directions.
Technical Analysis
Failure to cross the 50-day simple moving average (SMA) during early-month rally highlights the importance of 0.6970 figure, a break of which can further propel the quote towards current month high near 0.7022 ahead of diverting the bulls toward 0.7040 number comprising 100-day SMA.
Meanwhile, May 27 high around 0.6940, followed by 0.6900 and 0.6860 are likely nearby supports to watch during the pair’s U-turn whereas the month’s bottom surrounding 0.6830 may gain bears’ attention then after.
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. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD stays in positive territory near 1.0650
EUR/USD clings to modest daily gains at around 1.0650 in the American session on Wednesday. The US Dollar struggles to gather strength amid a modest improvement seen in risk mood and helps the pair hold its ground.
GBP/USD stabilizes at around 1.2450 after UK inflation data
GBP/USD consolidates its daily gains near 1.2450 after recovering toward 1.2500 with the immediate reaction to stronger-than-expected inflation data from the UK. The renewed US Dollar weakness also helps the pair hold its ground.
Gold eases despite risk-off mood
Gold trades in a relatively tight range near $2,390 in the second half of the day on Wednesday. In the absence of high-tier data releases, investors keep a close eye on headlines surrounding the Iran-Israel conflict.
XRP tests $0.50 resistance after Ripple CLO clarifies that no pretrial conference took place with SEC
XRP is stuck below $0.50 resistance after failing to close above this level since Monday. Ripple CLO Stuart Alderoty said late Tuesday there was no pretrial conference since the SEC dropped charges against executives.
World economy: To cut or not to cut (simultaneously)?
US inflation March figure, again higher than expected, put an end to the scenario of a simultaneous first rate cut by the Fed, the ECB, and the BoE in June.