- AUD/USD looks to snap 3-day winning streak on Friday.
- US Dollar Index stays calm above mid-96s ahead of key data.
- Business activity in the US manufacturing sector is expected to expand at a soft pace.
The AUD/USD pair, which closed the previous trading days in the positive territory and gained more than 100 pips after dropping to its lowest level since early January on Tuesday, struggled to preserve its bullish momentum on Friday and retraced a small portion of this week's rally. As of writing, the pair was down 0.25% on the day at 0.6905.
In the absence of significant macroeconomic data releases on Friday, the pair's fall seems to be a technical correction as investors, who have been pricing a Fed rate cut as early as July, remain on the sidelines. According to the CME Group's FedWatch Tool, markets are pricing 69.8% and 30.2% probability of a 25 basis points and 50 basis points rate cut in July, respectively.
After falling to its lowest level in two weeks at 96.50 earlier today, the US Dollar Index has gone into a consolidation phase and was last seen at 96.60, where it was virtually unchanged on a daily basis. At 13:45 GMT, the IHS Markit its advanced Manufacturing and Services PMI figures for the U.S. A weaker-than-expected reading in either of the PMIs could put the greenback under a renewed selling pressure and help the pair retrace its daily losses. Additionally, Cleveland Fed President Loretta Mester and Fed Governor Lael Brainard will be delivering speeches.
Earlier today, Fed Vice Chair Richard Clarida told Bloomberg that there was a broad agreement that the case for a looser Fed policy had increased to reaffirm the FOMC's willingness to cut rates.
Technical levels to consider
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 clings to daily gains above 1.0650
EUR/USD gained traction and turned positive on the day above 1.0650. The improvement seen in risk mood following the earlier flight to safety weighs on the US Dollar ahead of the weekend and helps the pair push higher.
GBP/USD recovers toward 1.2450 after UK Retail Sales data
GBP/USD reversed its direction and advanced to the 1.2450 area after touching a fresh multi-month low below 1.2400 in the Asian session. The positive shift seen in risk mood on easing fears over a deepening Iran-Israel conflict supports the pair.
Gold holds steady at around $2,380 following earlier spike
Gold stabilized near $2,380 after spiking above $2,400 with the immediate reaction to reports of Israel striking Iran. Meanwhile, the pullback seen in the US Treasury bond yields helps XAU/USD hold its ground.
Bitcoin Weekly Forecast: BTC post-halving rally could be partially priced in Premium
Bitcoin price shows no signs of directional bias while it holds above $60,000. The fourth BTC halving is partially priced in, according to Deutsche Bank’s research.
Week ahead – US GDP and BoJ decision on top of next week’s agenda
US GDP, core PCE and PMIs the next tests for the Dollar. Investors await BoJ for guidance about next rate hike. EU and UK PMIs, as well as Australian CPIs also on tap.