AUD/USD: Bulls re-attempt 0.6450 as Gold sees fresh leg higher

Fresh bids emerged near 0.6425 in European trading, allowing the AUD/USD bulls to re-attempt the 0.6450 barrier.

The main catalyst behind the renewed uptick in the resource-linked, the aussie, is seen as the fresh leg higher gold and oil prices. Gold refreshed 7.5-year highs above $1760 while WTI oil conquered the 31 mark after the European traders hit their desks and took cues from their Asian peers.

The yellow metal continues to draw bids from the rife US-China tensions over the coronavirus handling, global economic gloom and increased expectations of more monetary policy stimulus. Recall that Australia is likely to overtake China as the world’s no. 1 gold producer next year.  

Meanwhile, easing of the lockdown restrictions worldwide lifts hopes of an economic upturn sooner and, in turn, boosts the demand for the higher-yielding assets such as the aussie dollar, oil, stocks etc.

Amid the upbeat market mood and US Federal Reserve (Fed) Chairman J. Powell’s warnings about the US economic warning, the US dollar remains broadly undermined and helps push the spot northwards. The US dollar index meanders near a daily low of 100.28, down 0.10% so far.  

The aussie ignored the upbeat results of the employment survey conducted by the Australian Bureau of Statistics (ABS), as the risk sentiment and gold price-action remain the key market drivers. The focus now shifts towards the Reserve Bank of Australia’s (RBA) monetary policy meeting’s minutes due out on Tuesday. The US macro calendar remains almost data-empty on Monday.

AUD/USD technical levels to watch

At the press time, AUD/USD adds 0.41% to trade at 0.6441, with the upside attempt likely to face immediate resistance at 0.6458 (10-DMA). A break above the latter would open doors towards 0.6475 (May 15 high). To the downside, the 0.6400 support still remains critical before the bears eye May 7 low of 0.6377.

AUD/USD additional technical levels