AUD/USD eyes Aussie Retail Sales to keep 0.7600 on bull’s radar

AUD/USD traders catch a breather around 0.7580/85 after Monday’s volatile session on risk news. The aussie pair initially dropped to more than a week’s low near 0.7450, just to recover the majority of losses while beginning Tuesday’s Asian session a bit shy of the 0.7600 threshold.

Vaccine, US aid package favor risks…

Global markets began the week’s trading on a back foot, mainly on downbeat weekend updates over Brexit and the new strain of the coronavirus (COVID-19). Though, market mood improved afterward as positive headlines concerning the vaccine and US covid stimulus join cautious optimism over Brexit.

Although a drive to cut UK flights and stringent activity restrictions in Britain weighs on the trading sentiment, hopes that vaccine manufacturers can tame the recently developed variant of the COVID-19 test bears. Further, UK PM Boris Johnson’s eleventh-hour push to the demands on fisheries seem to have worked for the Brexit talks as latest chatters suggest policymakers from the European Union (EU) and Britain are moving closer towards a deal that can be signed before the year ends.

Also on the positive side could be Capitol Hill’s ability to avert the government shutdown with stopgap funding and also finalize the details. Asian traders currently await final details of the much-awaited aid package to keep the recent recovery at risk.

That said, Wall Street closed mixed while the US 10-year Treasury yields dropped 1.2 basis points (bps) by the end of Monday’s North American trading.

Looking forward, the formal announcement of the US stimulus can offer additional strength to the latest upside momentum from 0.7461 while the preliminary reading for November month’s Aussie Retail Sales, prior +1.4% YoY, can add filters to the direction. Though, negative updates concerning the virus and Brexit will have their impact on the markets.

Technical analysis

Having bounced off 21-day SMA, at 0.7455 now, AUD/USD buyers need to cross the previous day’s high of 0.7615 to retake controls. Meanwhile, an ascending trend line from November 02, currently around 0.7520, can offer immediate support during fresh downside.