AUD/USD: Consolidates recent gains below 0.7200 as NFP day begins


  • AUD/USD stays a bit shy of 0.7210, highest in eight days, flashed the previous day.
  • Market mood stays mildly positive amid stimulus hopes, stabilizing virus data from Europe.
  • Brexit, pre-NFP cautious mood probe the risk-takers amid broad US dollar weakness.
  • Australian Retail Sales can offer immediate direction, risk catalysts will be the key.

AUD/USD seesaws around 0.7185/90 at the start of Friday’s Asian trading session. The quote rose for the fourth consecutive day on Thursday while refreshing over one week's top before easing from 0.7210. US dollar weakness and a mild optimism concerning the American aid package talks, coupled with a pause in the surging coronavirus (COVID-19) numbers from Europe, seem to have favored the Aussie buyers off-late.

Back to good days?

The US policymakers are jostling over the much-awaited stimulus package. Even if ruling Republicans refrain from accepting anything beyond $1.5 trillion demand, versus Democratic bid for $2.2 trillion, comments from the House Speaker Nancy Pelosi that they’re half-way to the negotiations keep traders positive for the outcome. It should also be noted that Japanese policymakers’ push for the additional push to fiscal easing also favored market sentiment.

Elsewhere, the European numbers for the virus have been soothing lately with the UK’s fresh counts marking 6,914 new confirmed coronavirus infections versus Wednesday's increase of 7,108. Market optimism also took note of Reuters’ news suggesting the health regulator has started reviewing data on AstraZeneca and Oxford University’s potential COVID-19 vaccine in real-time.

On the contrary, the bloc prepares legal action against the UK after British PM Boris Johnson rolls-up sleeves to break the international law with his (Internal Market Bill). Further to challenge the trading sentiment is the US-China tussle and political uncertainty in America.

Talking about the data, Australia activity numbers, flashed by AiG and the Commonwealth Bank of Australia (CBA), couldn’t please the pair bulls whereas downbeat US ISM Manufacturing PMI did dominate over Personal Income-Spending figures to keep AUD/USD buyers happy.

Against this backdrop, Wall Street manages to print mild gains whereas the US 10-year Treasury yields stepped back from near 0.70% area to 0.68% by the end of Thursday’s North American session.

Looking forward, Australia’s September month Retail Sales, expected to confirm a -4.2% preliminary forecast, can offer immediate direction to AUD/USD traders ahead of the long US session. It’s worth mentioning that the absence of Chinese players and the pre-NFP trading lull may restrict the market moves.

Read: Nonfarm Payrolls Preview: Eagerly waiting for an upbeat report

Technical analysis

A confluence of 21-day and 50-day SMA, currently near 0.7206/12 restricts the pair’s upside momentum towards a falling trend line from September 01, at 0.7281 now. Meanwhile, the August 20 low near 0.7130 can offer immediate support during further downside ahead of 100-day SMA near 0.7030.

Additional important levels

Overview
Today last price 0.7187
Today Daily Change 24 pips
Today Daily Change % 0.34%
Today daily open 0.7163
 
Trends
Daily SMA20 0.7214
Daily SMA50 0.7205
Daily SMA100 0.7026
Daily SMA200 0.6777
 
Levels
Previous Daily High 0.7176
Previous Daily Low 0.71
Previous Weekly High 0.7325
Previous Weekly Low 0.7004
Previous Monthly High 0.7414
Previous Monthly Low 0.7004
Daily Fibonacci 38.2% 0.7147
Daily Fibonacci 61.8% 0.7129
Daily Pivot Point S1 0.7116
Daily Pivot Point S2 0.707
Daily Pivot Point S3 0.704
Daily Pivot Point R1 0.7193
Daily Pivot Point R2 0.7223
Daily Pivot Point R3 0.7269

 

 

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