AUD/USD clings to recovery gains near session tops, around 0.7080-85 area

AUD/USD gained some positive traction and built on the overnight bounce from two-month lows.
Improving global risk sentiment undermined the safe-haven greenback and remained supportive.
Coronavirus jitters, a pickup in the US bond yields might limit the USD slide and cap the upside.

Haresh Menghani FXStreet

The AUD/USD pair edged higher through the early European session and was last seen trading near the top end of its daily trading range, around the 0.7080-85 region.

The pair built on the previous day's late rebound from the 0.7015 region, or over two-month lows and gained some positive traction on the last trading day of the week. A softer tone surrounding the US dollar was seen as one of the key factors that extended some support and assisted the AUD/USD pair to snap four consecutive days of the losing streak.

A modest recovery in the equity markets prompted some USD profit-taking from two-month tops and benefitted the perceived riskier Australian dollar. The global risk sentiment got a minor boost from the overnight reports, indicating that Democrats in the US House of Representatives are working on a $2.2 trillion coronavirus stimulus package.

Meanwhile, the risk-on flow pushed the US Treasury bond yields higher. This, along with concerns about the second wave of coronavirus infections and the likelihood of the global economic slowdown, could help revive the USD demand. This, in turn, might keep a lid on any further gains for the AUD/USD pair, warranting some caution for bullish traders.

Hence, it will be prudent to wait for some strong follow-through buying before confirming that the recent corrective slide from YTD tops is already over. Market participants now look forward to the release of the US Durable Goods Orders data, which might influence the USD price dynamics and produce some short-term trading opportunities.

Technical levels to watch

AUD/USD

Overview
Today last price	0.7085
Today Daily Change	0.0039
Today Daily Change %	0.55
Today daily open	0.7046

Trends
Daily SMA20	0.7267
Daily SMA50	0.7203
Daily SMA100	0.7002
Daily SMA200	0.6773

Levels
Previous Daily High	0.7086
Previous Daily Low	0.7016
Previous Weekly High	0.7346
Previous Weekly Low	0.7254
Previous Monthly High	0.7416
Previous Monthly Low	0.7076
Daily Fibonacci 38.2%	0.7042
Daily Fibonacci 61.8%	0.7059
Daily Pivot Point S1	0.7012
Daily Pivot Point S2	0.6979
Daily Pivot Point S3	0.6942
Daily Pivot Point R1	0.7083
Daily Pivot Point R2	0.712
Daily Pivot Point R3	0.7154

Author

Haresh Menghani

FXStreet

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

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