AUD/USD consolidates at around 0.6740 for the week, with traders eyeing Fed speeches

AUD/USD is set to finish the week with solid gains of 0.28%.
The US ISM Services PMI was a tick lower than the previous month’s data, signaling the US economy is solid.
AUD/USD traders eye Federal Reserve speeches throughout the day.

Christian Borjon Valencia FXStreet

The AUD/USD jumped from around weekly lows below 0.6700 and climbed 0.44% on Friday. Factors like a risk-on impulse and an offered US Dollar (USD) keep the Australian Dollar (AUD) positive in the day. At the time of typing, the AUD/USD is trading at 0.6745.

AUD/USD creeps higher toward 0.6750

Sentiment remains upbeat, a headwind for the safety of the US Dollar. The US ISM Non-Manufacturing PMI for February was 55.1, slightly lower than the previous month’s 55.2. However, it exceeded expectations of 54.5, indicating that business activity is still strong. The Prices Paid Index subcomponent, looked by investors for inflationary pressures, increased to 65.6, above estimates of 64.5. Although it was lower than January’s 67.8, data would keep traders tracking Federal Reserve’s (Fed) officials’ speakers throughout the day.

US Federal Reserve’s (Fed) speakers highlighted the importance of tackling inflation towards the 2% target. On Thursday, Fed Governor Christopher Waller commented that inflation was not easing as expected and signaled his openness to increase rates if price pressures don’t reduce.

Following the release, the greenback weakened as the US Dollar Index recovered from daily lows and reached 104.924. As of writing, it resumed its downtrend at 104.848, down 0.11%.

The AUD/USD recovered after dropping toward 0.6732 and advanced towards 0.6760 before settling at around current exchange rates.

On the Australian side, the S&P Global Services PMI exceeded estimates, while the S&P Global Composite PMI was 50.6, higher than January’s 49.2, signaling the Australian economy is doing far better than expected.

Additionally, the Caixin Services PMI improved in China at 55, compared to 50.5 consensus, expanded at the fastest rhythm in six months in February as removing harsh COVID-19 restrictions revived customer demand, driving a solid increase in employment, a private sector survey showed on Friday.

What to watch?

Federal Reserve speakers will be crossing wires led by the Dallas Fed President Lorie Logan, Atlanta’s Fed Raphael Bostic, Fed Governor Michell Bowman, and the Richmond Fed President Thomas Barkin.

AUD/USD Technical levels

AUD/USD

Overview
Today last price	0.6743
Today Daily Change	0.0011
Today Daily Change %	0.16
Today daily open	0.6732

Trends
Daily SMA20	0.6861
Daily SMA50	0.6897
Daily SMA100	0.6744
Daily SMA200	0.6794

Levels
Previous Daily High	0.6766
Previous Daily Low	0.6707
Previous Weekly High	0.6921
Previous Weekly Low	0.6719
Previous Monthly High	0.7158
Previous Monthly Low	0.6698
Daily Fibonacci 38.2%	0.6729
Daily Fibonacci 61.8%	0.6743
Daily Pivot Point S1	0.6704
Daily Pivot Point S2	0.6676
Daily Pivot Point S3	0.6644
Daily Pivot Point R1	0.6763
Daily Pivot Point R2	0.6795
Daily Pivot Point R3	0.6823

Author

Christian Borjon Valencia

FXStreet

Markets analyst, news editor, and trading instructor with over 14 years of experience across FX, commodities, US equity indices, and global macro markets.

AUD/USD holds above 0.6950 as bullish USD caps gains

AUD/USD edges lower during the Asian session on Tuesday, stalling a two-day recovery move from a two-month low, touched last week. An extended rout in the fixed income market keeps US bond yields elevated near multi-year highs. This, along with geopolitical uncertainties, helps the US Dollar retain its bullish tone despite receding October Fed hike bets. However, expectations for another RBA rate hike this month could act as a tailwind for the Aussie.

USD/JPY remains confined in a range; 158.00 holds the key

USD/JPY extends its consolidative move during the Asian session on Tuesday, trading below 158.00 amid diverging forces. Hawkish BoJ expectations support the Japanese Yen amid looming intervention risks. Meanwhile, geopolitical uncertainty and elevated US bond yields keep the US Dollar near its YTD high despite receding October Fed hike bets. This, in turn, holds back traders from placing aggressive directional bets.

Gold holds steady below $4,150 as receding Fed hike bets lend support

Gold continues its struggle to gain any meaningful traction, holding steady below $4,150 during the Asian session on Tuesday. Receding October Fed hike bets act as a tailwind for the non-yielding bullion, though a bullish US Dollar caps the upside. Furthermore, traders await the release of the FOMC Minutes on Wednesday for more cues about the future policy path and some meaningful impetus.

Ethereum: BitMine scoops extra ETH tokens following Q3 outperformance

Ethereum (ETH) treasury firm BitMine Immersion continued its buying streak of the top altcoin last week. The firm acquired 15,112 ETH, lifting its holdings to 6.016 million ETH, representing 4.9% of ETH's circulating supply and worth $16.16 billion at the time of writing. That brings the company roughly 98.5% closer to acquiring 5% of ETH's supply, a goal it tags "Alchemy of 5%."

Markets just priced out rate hikes on financial stress. This chart shows why 2022-23 says they’ll be wrong

Traders have taken about one quarter-point hike out of their European Central Bank forecasts since mid-September, betting the ECB will stop raising rates because of a French debt selloff. The same bet failed twice in 2022 and 2023, when the ECB kept raising rates through financial stress because inflation was above its 2% target. Euro-area inflation came in at 3.8% in September.

Eurozone inflation just hit 3.8%, its highest in three years. This chart shows why the ECB can’t simply hike its way out

The ECB would normally have a relatively straightforward answer to inflation running almost twice its target: raise interest rates. But these are not normal circumstances. This time, the bond market is already doing part of the tightening for it, leaving the ECB facing an increasingly difficult dilemma.