AUD/USD flirts with 0.6700 mark, focus shifts to Chinese macro data dump on Friday

AUD/USD remains on the defensive despite a modest USD pullback from the daily high.
The US bond yields retreat in reaction to the mixed US macro data and weigh on the buck.
Aggressive Fed rate hike bets, recession fears limit the USD losses and continue to cap.
Investors now eye the Chinese data dump on Friday for some meaningful opportunities.

Haresh Menghani FXStreet

The AUD/USD pair once again finds some support ahead of the 0.6700 mark and recovers a few pips from the daily low during the early North American session. The pair is currently trading around the 0.6725-0.6730 area, still down over 0.20% for the day.

The US dollar struggles to preserve its early modest gains and remains on the defensive for the second straight day on Thursday, which, in turn, offers some support to the AUD/USD pair. The mixed US economic data triggers an intraday pullback in the US Treasury bond yields and undermines the greenback.

That said, rising bets for a more aggressive policy tightening by the Fed, bolstered by Tuesday's stronger US CPI report, should act as a tailwind for the US bond yields. Apart from this, worries about a global economic downturn might continue to favour the USD bulls and cap the upside for the risk-sensitive aussie.

The fundamental backdrop suggests that the path of least resistance for the AUD/USD pair is to the downside. That said, it will still be prudent to wait for a sustained break below the 0.6700 mark before positioning for any further depreciating move. Traders now look forward to the Chinese data dump for a fresh impetus during the Asian session on Friday.

The focus, however, will remain on the key central bank event risk - the two-day FOMC monetary policy meeting on September 20-21. The outcome will play a key role in driving the USD demand in the near term and help determine the next leg of a directional move for the AUD/USD pair.

Technical levels to watch

AUD/USD

Overview
Today last price	0.6736
Today Daily Change	-0.0013
Today Daily Change %	-0.19
Today daily open	0.6749

Trends
Daily SMA20	0.6844
Daily SMA50	0.6894
Daily SMA100	0.6959
Daily SMA200	0.7111

Levels
Previous Daily High	0.676
Previous Daily Low	0.6705
Previous Weekly High	0.6877
Previous Weekly Low	0.6699
Previous Monthly High	0.7137
Previous Monthly Low	0.6835
Daily Fibonacci 38.2%	0.6739
Daily Fibonacci 61.8%	0.6726
Daily Pivot Point S1	0.6716
Daily Pivot Point S2	0.6683
Daily Pivot Point S3	0.6661
Daily Pivot Point R1	0.6771
Daily Pivot Point R2	0.6793
Daily Pivot Point R3	0.6826

Author

Haresh Menghani

FXStreet

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

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