AUD/USD keeps mild gains around 0.7150 on mixed China PMI, firmer yields


  • AUD/USD stays sidelined around intraday high following China data release.
  • China NBS Manufacturing PMI improves but Non-Manufacturing PMI eases in November.
  • Market sentiment improves as Omicron fears ebb, policymakers stay cautiously optimistic.
  • US data, testimonies from Fed’s Powell and Treasury Secretary Yellen will join coronavirus update to direct immediate moves.

AUD/USD struggles to cheer activity data from the key customer China during early Tuesday, taking rounds to 0.7150 by the press time. Even so, the risk barometer pair prints mild gains amid receding fears from the South African covid strain, dubbed as Omicron.

China’s headline NBS Manufacturing PMI jumped back to expansion territory with above 50.0 numbers for the first time in three months but Non-Manufacturing PMI eased below market consensus and prior readouts during November. Following the data release, China says, “Economic mood is improving as 3 PMIs show expansion.”

Read: China's November official Manufacturing PMI back in expansion

It’s worth noting that the recent recovery in the US Treasury yields and firmer Asia-Pacific stocks, together with the US S&P 500 Futures, also underpin the AUD/USD strength.

The reason could be linked to US President Joe Biden’s rejection of lockdown’s need and from Fed Chair Jerome Powell who accepts covid challenges for inflation and jobs report but backs inflation pressure. Further, US Treasury Secretary Janet Yellen also placates market pessimism while pushing Congress to overcome the US debt limit deadlock, as well as highlighting the strength of the US economy.

On the contrary, news that the US global military posture highlighted the need to work with allies and partners to beef up deterrence against potential Chinese aggression and North Korean threats, per Kyodo News, adds to the US dollar’s safe-haven demand and challenge AUD/USD buyers. Furthermore, the market’s anxiety ahead of the week’s key data, like Fed Chair Jerome Powell’s testimony and jobs report for November, also probe the Aussie pair’s upside moves.

Other than the catalysts stated above, US CB Consumer Confidence for November and covid updates will also be important for the AUD/USD traders. Recently, ABC News confirms the fifth case of the covid variant in New South Wales.

Read: Conference Board Consumer Confidence Preview: Spending immunity

Technical analysis

AUD/USD wobbles around the yearly support line, inside the immediate rising channel for the last two days. Adding to the bearish bias is the descending RSI line and retreat of the bullish MACD line, not to forget sustained trading below 50-HMA and a weekly resistance trend line. That said, selling pressure could escalate on the clear downside break of the immediate channel, supported around 0.7120.

Additional important levels

Overview
Today last price 0.7143
Today Daily Change 0.0012
Today Daily Change % 0.17%
Today daily open 0.7131
 
Trends
Daily SMA20 0.7298
Daily SMA50 0.7339
Daily SMA100 0.734
Daily SMA200 0.7515
 
Levels
Previous Daily High 0.716
Previous Daily Low 0.7114
Previous Weekly High 0.7273
Previous Weekly Low 0.7111
Previous Monthly High 0.7557
Previous Monthly Low 0.7191
Daily Fibonacci 38.2% 0.7131
Daily Fibonacci 61.8% 0.7142
Daily Pivot Point S1 0.711
Daily Pivot Point S2 0.7088
Daily Pivot Point S3 0.7063
Daily Pivot Point R1 0.7156
Daily Pivot Point R2 0.7181
Daily Pivot Point R3 0.7203

 

 

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