The AUD/USD pair failed to build on early recovery move and has now slipped into negative territory for the fourth consecutive session.
Spot ran through fresh offers during early NA session and moved back within striking distance of 3-1/2 month lows touched in the previous session. The pair latest leg of downslide could be attributed to a fresh wave of up-surge in the US treasury bond yields, which tends to underpin the greenback demand and drive flows away from higher-yielding currencies - like the Aussie.
Despite of the disappointing headline Q1 US GDP number, showing a dismal growth of 0.7% annualized growth, GDP Price Index and Employment Cost Index both pointed to prevailing inflationary pressures in the economy. Higher inflation expectations revived hopes for additional Fed rate-hike move through 2017 and helped the key US Dollar index to bounce of multi-month lows touched earlier during the day.
Apart from the advance GDP print, the US economic docket also features the release of Chicago PMI and Revised UoM Consumer Sentiment, which would now be looked upon for some fresh trading impetus.
Technical levels to watch
Jim Langlands, Principal at FX Charts writes, “the dailies still look pretty neutral so cautious stance is required but the 4 hour momentum indicators are pointing lower, so a retest of 0.7440 seems possible, below which would then find only minor support until we reach 0.7385. On the topside, the initial resistance will be seen at Thursday’s high (0.7491) and then again at 0.7510 and 0.7525.”
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD retreats below 1.0700 after US GDP data
EUR/USD came under modest bearish pressure and retreated below 1.0700. Although the US data showed that the economy grew at a softer pace than expected in Q1, strong inflation-related details provided a boost to the USD.
GBP/USD declines below 1.2500 as USD rebounds
GBP/USD declined below 1.2500 and erased the majority of its daily gains with the immediate reaction to the US GDP report. The US economy expanded at a softer pace than expected in Q1 but the price deflator jumped to 3.4% from 1.8%.
Gold holds near $2,330 despite rising US yields
Gold stays in positive territory near $2,330 in the second half of the day on Thursday. The benchmark 10-year US Treasury bond yield is up more than 1% on the day above 4.7% after US GDP report, making it difficult for XAU/USD to extend its daily rally.
XRP extends its decline, crypto experts comment on Ripple stablecoin and benefits for XRP Ledger
Ripple extends decline to $0.52 on Thursday, wipes out weekly gains. Crypto expert asks Ripple CTO how the stablecoin will benefit the XRP Ledger and native token XRP.
After the US close, it’s the Tokyo CPI
After the US close, it’s the Tokyo CPI, a reliable indicator of the national number and then the BoJ policy announcement. Tokyo CPI ex food and energy in Japan was a rise to 2.90% in March from 2.50%.