- AUD/USD fizzles latest recovery from 0.7686, struggles to repeat Tuesday’s gain.
- US Treasury Secretary Nominee Janet Yellen fired double-barrel gun in her Senate Speech, investments and China surprised.
- Virus woes fade at home and abroad but fears aren’t out of the woods.
- Australia’s Westpac Consumer Confidence, PBOC rate decision to decorate calendar, Biden’s inauguration eyed closely.
AUD/USD flirts with the 0.7700 threshold, following the latest bounce off 0.7686, during the early Asian session trading on Wednesday. The risk barometer marked a corrective pullback to 0.7726 the previous day before easing to 0.7686 as the incoming US Treasury Secretary Yellen doesn’t offer all good signals during her Senate speech. The aussie also eases amid cautious sentiment ahead of US President-elect Joe Biden’s inaugural ceremony.
White House will welcome Biden…
In her first confrontation to the US Senate as a Biden group member, Janet Yellen played well despite prepared speech was already out. The ex-Fed Chair backed Biden’s heavy stimulus while pointing the current necessity to overcome the pandemic and record low-interest rate. However, her remarks over the next phase of stimulus, likely to roll out in February, as well as suggestions to compete with China and President Donald Trump’s investment guide probed the risk-on mood.
Read: Janet Yellen: US must make investments to enable it to compete with China
Elsewhere, the coronavirus (COVID-19) fears seesaw even as infections recede in the northern hemisphere and Australia. The reason could be spotted from the recently announced extension to Germany’s lockdown and comments from New York Governor Bill De Blasio suggesting a likely shortage of vaccine.
It should be noted that the previous day’s release of HIA New Home Sales, up 32.5% versus 15.2% prior, for December joined the initial risk-on mood to snap the two-day downtrend on Tuesday.
Against this backdrop, Wall Street benchmarks managed to close in green while the US 10-year Treasury yields eased to 1.09% by the end of Tuesday’s trading.
Looking forward, Australia’s Westpac Consumer Confidence for January, prior 4.1%, will offer immediate direction but major attention will be given to what happens in the White House ceremony to welcome Biden Although all precautionary measures are taken to avoid the repetition of the Capitol Hill incidents, fears of the same can join virus woes and challenges to China while probing the AUD/USD bulls.
Technical analysis
Failures to regain above the previous trend line from November near 0.7745, broken recently, keep AUD/USD sellers hopeful. However, 21-day SMA around 0.7685 guards immediate downside.
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