• AUD/USD edges up by 1%, boosted by a soft greenback.
  • China’s Trade Balance surplus increased the appetite for the risk-sensitive AUD.
  • The AUD/USD got bolstered by last week’s RBA’s tightening expectations.

The AUD/USD rallied during the North American session as the market mood turned mixed, with US equities fluctuating, while the greenback tumbles on the back of falling US Treasury bond yields after a strong US jobs report.

The AUD/USD is trading at 0.6980, shy of the day’s highs, reached late in the New York session. During the Asian session, the major gapped down and printed the daily low at 0.6897, but since never looked back, advancing sharply, towards 0.7009, before retracing to current price levels.

AUD/USD bolstered by China’s Trade Balance data, as the US dollar weakened

Last Friday’s US Nonfarm Payrolls report showed that the US economy added 528K employees, further cementing the case for the US Federal Reserve to continue its “aggressive” tightening path. That spurred a jump in US bond yields. Meanwhile, money market future STIRs expectations of a 75 bps rate hike for the FOMC’s September meeting, topping 90%.

Over-the-weekend, Fed’s board member Michelle Bowman crossed newswires. She said, “I supported the FOMC’s decision last week to raise the federal funds rate another 75 basis points,” and added that “similarly-sized” hikes should be on the table until we (the Fed) see inflation declining consistently.

Even though that’s positive for the greenback, the US Dollar Index is falling 0.20% at 106.370, undermined by diving US T-bond yields. Therefore, the AUD/USD is recording its largest gain since July 19.

During the Asian session, an absent Australian economic docket left traders leaning toward China’s data. Chinese exports grew at an 18% YoY pace, vs. 14.1% YoY estimations, up from June’s figures. Imports slowed to 2.3% YoY vs. 4.0% estimated. Consequently, the Trade Balance recorded a surplus of $101 B vs. $89 B foreseen.

That said, alongside last week’s Reserve Bank of Australia (RBA) signaling more tightening in the upcoming months, it was a tailwind for the Aussie. The AUD/USD rebounded near the 20-day EMA at 0.6904 and, on its way towards the daily high, reclaimed the 50-day EMA.

What to watch

The Australian economic docket will feature July’s NAB Business Conditions and Business Confidence. On the US front, the US calendar will feature July’s CPI, and PPI data on Wednesday and Thursday, respectively. That, alongside further Fed commentary led by Charles Evans, Neil Kashkari, and Mary Daly, would shed some light regarding the posture of the central bank.

AUD/USD Key Technical Levels

AUD/USD

Overview
Today last price 0.6980
Today Daily Change 0.0079
Today Daily Change % 1.14
Today daily open 0.6901
 
Trends
Daily SMA20 0.6894
Daily SMA50 0.6955
Daily SMA100 0.7106
Daily SMA200 0.7161
 
Levels
Previous Daily High 0.6979
Previous Daily Low 0.6869
Previous Weekly High 0.7048
Previous Weekly Low 0.6869
Previous Monthly High 0.7033
Previous Monthly Low 0.668
Daily Fibonacci 38.2% 0.6911
Daily Fibonacci 61.8% 0.6937
Daily Pivot Point S1 0.6854
Daily Pivot Point S2 0.6807
Daily Pivot Point S3 0.6745
Daily Pivot Point R1 0.6963
Daily Pivot Point R2 0.7026
Daily Pivot Point R3 0.7073

 

 

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 rebounds above 0.9800 on renewed dollar weakness

EUR/USD rebounds above 0.9800 on renewed dollar weakness

EUR/USD has gathered recovery momentum and turned positive on the day above 0.9800 in the American session on Monday. The disappointing ISM Manufacturing PMI from the US weighed heavily on the greenback, providing a boost to the pair.

EUR/USD News

GBP/USD clings to impressive daily gains near 1.1300

GBP/USD clings to impressive daily gains near 1.1300

GBP/USD has extended its daily rally and touched a fresh 10-day high above 1.1300 in the second half of the day on Monday. The UK government's U-turn on the fiscal plan and the broad-based selling pressure surrounding the greenback after PMI data fuel the pair's upside.

GBP/USD News

Gold bulls aim to challenge the $1,700 threshold

Gold bulls aim to challenge the $1,700 threshold

Gold picked up momentum after Wall Street’s opening, and runs above $1,690.00 a troy ounce, trading at its highest in three weeks. The greenback sheds ground on the back of the better performance of equities, coupled with tepid US data.

Gold News

Cardano could be set for 12% gains just this week alone

Cardano could be set for 12% gains just this week alone

ADA could set itself up this week for a perfect opportunity to go long in a bear market. Markets may experience some risk-on this week, with markets potentially set to jump, and equities and a weaker dollar offering some room for cryptocurrencies to rally in.

Read more

TSLA set to fall more as delivery data disappoints

TSLA set to fall more as delivery data disappoints

Tesla (TSLA) looks set to open sharply lower on Monday as the equity market continues to battle raging storms. Last week was a momentous one in currency markets, and those of us in equity land need to keep note of this.

Read more

Forex MAJORS

Cryptocurrencies

Signatures