AUD/USD extends recovery from yearly lows towards 0.7200 amid risk-on profile


  • AUD/USD jumps in sync with risk appetite, S&P 500 futures climb 1%.
  • Upbeat mood weighs on USD’s haven demand while Omicron risks loom.
  • Australian Q3 GDP beat helps the aussie recover lost ground ahead of US data.

AUD/USD is flirting with three-day highs near 0.7170, as the buying pressure around the Australian dollar remains unabated amid a rebound in risk appetite.

Market optimism set in this Wednesday after the Asian regional manufacturing data came in stronger and investors cheered Fed Chair Jerome Powell’s hints aimed at curbing inflation.

Powell said that tapering of the asset purchases could be quickened and the same could be discussed in the upcoming meeting.

Further, no bad news about the Omicron covid variant also helped calm the risk sentiment. The high beta currencies such as the aussie dollar benefit from the improved risk tone while the safe-haven US dollar struggles despite the recent strength in the Treasury yields.

The aussie also takes advantage of the upbeat Australian Q3 GDP report to extend its recovery from yearly lows of 0.7063 reached on Tuesday. The Australian economy contracted 1.9% QOQ in Q3 vs. -2.7% expected and 0.7% previous.

Traders ignored the contraction in the Chinese Caixin Manufacturing PMI data, as the risk recovery overshadowed and underpinned the sentiment around the major.

Looking ahead, the aussie bulls will await the US ADP jobs and ISM Manufacturing PMI to build on the recent upside. Powell’s testimony before the House Financial Services will also hog some limelight.

AUD/USD: Technical levels

“From a technical perspective, any subsequent move up is likely to confront stiff resistance and attract fresh selling near the 0.7200 round figure. This should cap the upside near the 0.7220 region. On the flip side, weakness back below the 0.7140 area now seems to find some support near the 0.7125-15 region,” FXStreet’s Analyst Haresh Menghani notes.

AUD/USD: Additional levels to consider

AUD/USD

Overview
Today last price 0.7169
Today Daily Change 0.0041
Today Daily Change % 0.58
Today daily open 0.7128
 
Trends
Daily SMA20 0.7283
Daily SMA50 0.7337
Daily SMA100 0.7337
Daily SMA200 0.7511
 
Levels
Previous Daily High 0.7171
Previous Daily Low 0.7063
Previous Weekly High 0.7273
Previous Weekly Low 0.7111
Previous Monthly High 0.7537
Previous Monthly Low 0.7063
Daily Fibonacci 38.2% 0.7104
Daily Fibonacci 61.8% 0.713
Daily Pivot Point S1 0.707
Daily Pivot Point S2 0.7012
Daily Pivot Point S3 0.6961
Daily Pivot Point R1 0.7178
Daily Pivot Point R2 0.7229
Daily Pivot Point R3 0.7287

 

 

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