• AUD/USD edges higher inside the weekly range between 0.7320 and 0.7220.
  • Market sentiment improves amid hopes of US stimulus, China Evergrande and covid conditions.
  • Fed’s Powell is up for backing taper tantrums citing inflation, unemployment concerns.
  • Australia Retail Sales may improve in August, Fedspeak, other risk catalysts also important for fresh impulse.

AUD/USD struggles to keep Monday’s rebound near 0.7300, around 0.7290 by the press time of Tuesday morning in Asia. The risk barometer pair portrays a sluggish mood in the market following an upbeat start to the week, not to forget mentioning cautious sentiment ahead of the preliminary readings of Australia Retail Sales for August.

The break to the latest AUD/USD recovery could also have taken clues from the prepared remarks of Fed Chair Jerome Powell’s testimony, up for publishing on Tuesday (the US time). Fed Chair Powell cited inflation and employment concerns while saying, “We would certainly respond and use our tools to ensure that inflation runs at levels that are consistent with our goal."

Furthermore, chatters that the Shenzen government is investigating the wealth management unit of Evergrande and urged to repay investors seem to challenge the risk appetite and to the Aussie pair.

Additionally, the US Dollar Index (DXY) also benefited from the firmer Treasury yields, underpinned by the Fed tapering concerns, as well as upbeat US Durable Goods Orders for August, 1.8% versus 0.7% forecast, to add to the upside filters for the AUD/USD.

Having witnessed a roller-coaster week filled with the Fed tapering and China’s Evergrande, traders were easy, mostly positive, on Monday amid receding fears of over the Beijing-based real estate firm. Also supporting the mood could be the headlines suggesting easing covid woes as well as market optimism that the economic recovery is gaining traction.

People’s Bank of China (PBOC) indirectly hints at supporting the real-estate firm while supporting to keep liquidity reasonably ample. On the other hand, New South Wales Premier Gladys Berejiklian saw October 11 as the start of easing lockdown restrictions while the final stage of reopening is scheduled for December 01.

Amid these plays, Wall Street benchmarks closed in the green while the US 10-year Treasury yields refreshed a three-month high by piercing a 1.50% level, closing around 1.49% with three basis points of an upside.

Moving on, AUD/USD traders will need to pay close attention to the preliminary readings of Australia’s Retail Sales for August, expected -2.5% versus -2.7%. Should the Aussie data disappoint, the latest weakness in the quote and fading sentiment may join challenging technicals to recall the sellers.

Technical analysis

Bearish divergence and 200-DMA challenges the AUD/USD buyers inside the 100-pip range between 0.7320 and 0.7220.

In addition to the 200-DMA level surrounding the 0.7300 threshold, an eight-day-old descending resistance line at 0.7305 adds to the upside filters before propelling the quote towards the 0.7320 hurdle.

Should the quote manages to defy the RSI divergence and crosses the 0.7320 resistance, September 10 top surrounding 0.7410 and the monthly peak near 0.7480 will be in focus.

On the contrary, pullback moves will be restricted by the stated range’s support near 0.7220.

Also likely to challenge the AUD/USD bears will be the 0.7200 round figure and 0.7150 support level ahead of August month’s low, also the yearly bottom surrounding 0.7105.

AUD/USD: Four-hour chart

Trend: Pullback expected

Additional important levels

Today last price 0.7287
Today Daily Change 0.0026
Today Daily Change % 0.36%
Today daily open 0.7261
Daily SMA20 0.7332
Daily SMA50 0.7327
Daily SMA100 0.7482
Daily SMA200 0.7597
Previous Daily High 0.7317
Previous Daily Low 0.7235
Previous Weekly High 0.7317
Previous Weekly Low 0.7219
Previous Monthly High 0.7427
Previous Monthly Low 0.7106
Daily Fibonacci 38.2% 0.7266
Daily Fibonacci 61.8% 0.7286
Daily Pivot Point S1 0.7225
Daily Pivot Point S2 0.7189
Daily Pivot Point S3 0.7143
Daily Pivot Point R1 0.7307
Daily Pivot Point R2 0.7353
Daily Pivot Point R3 0.7389



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.

Feed news Join Telegram

Recommended content

Recommended content

Editors’ Picks

EUR/USD edges lower toward 1.0850 ahead of mid-tier data

EUR/USD edges lower toward 1.0850 ahead of mid-tier data

EUR/USD edges slightly lower toward the 1.0850 area in the early European session on Monday as the cautious market mood helps the US Dollar hold its ground. Markets await business and consumer sentiment data from the Euro area and German growth figures.


GBP/USD stays on the back foot below 1.2400

GBP/USD stays on the back foot below 1.2400

GBP/USD came under modest bearish pressure and dropped below 1.2400 at the beginning of the week. The negative shift witnessed in risk mood helps the US Dollar find demand as a safe haven and makes it difficult for the pair to gain traction.


Gold shows resilience below 200-hour SMA, bulls have the upper hand

Gold shows resilience below 200-hour SMA, bulls have the upper hand

Gold price kicks off the new week on a subdued note and oscillates in a narrow trading band through the Asian session. The XAU/USD remains well within the striking distance of a nine-month peak touched last Thursday.

Gold News

Why Ethereum bears need to be cautious about shorting ETH before $2,000

Why Ethereum bears need to be cautious about shorting ETH before $2,000

Ethereum price has been consolidating after the January rally subsided after three weeks. This tightening continues even after BTC shot up 3% over the weekend. Therefore, a short-term spike in buying pressure should is likely. 

Read more

Big risk this week Fed hikes 50 points

Big risk this week Fed hikes 50 points

While the entire global investment community is apparently very excited about the US Fed slowing its rate increases to 25 bps, there are strong reasons for arguing why another 50 bps rate hike, or two, are still on the menu.

Read more