AUD/USD rebounds to upper 0.6800s in tandem with risk assets, still down substantially on the week


  • AUD/USD has rebounded into the upper 0.6800s, though remains on course for hefty on-the-week losses of over 2.5%.
  • Risk asset weakness plus China lockdown/growth concerns that have weighed on industrial commodities hit the Aussie hard this week.
  • Focus next week will be on Chinese data, the RBA minutes plus Australian Q1 WPI and labor market data.

The Aussie has staged a rebound on Friday in tandem with other recently hard-hit risk assets, though remains on course to post ugly on the week losses amid concerns about China lockdowns and amid associated recent downside in industrial commodity prices. AUD/USD is at present trading in the 0.6880s, higher by about 0.5% on the day after the pair hit its lowest levels since June 2020 on Thursday in the 0.6830 area.

However, the pair remains on course to end the week more than 2.5% lower, taking its losses in the last six weeks since it posted 2022 highs in the upper 0.7600s to more than 10%. Cities representing around 40% of China’s GDP, including Shanghai and Beijing, remain under some degree of Covid-19-related lockdown as of the end of this week, analysts said on Friday, warning in the same breath that upcoming Retail Sales and Industrial Production data this weekend will probably be ugly.

China also placed limits on unnecessary travel to and from the country this week. Against the backdrop of a weakening Chinese economy as it presses ahead with its zero-Covid-19 strategy and resultant harsh restrictions, it is probably too soon to bet on a rebound back into the 0.70s for AUD/USD.

A massive turnaround in the market’s appetite for risk might be enough to do it, but that also doesn’t seem likely, with the latest commentary from Fed Chair Jerome Powell on Thursday suggesting the Fed is as keen as ever to press ahead with monetary tightening in wake of this week’s hotter-than-forecast US inflation data. A rally back to the significant resistance area around 0.7000 (late 2021/early 2022 lows) likely remains a sell for many traders.

The minutes of the RBA’s last policy meeting where they surprised markets with a larger-than-expected 25 bps rate hike to 0.35% will be released on Monday, ahead of key Q1 Wage Price Index (WPI) data on Wednesday and April labour market figures on Thursday. While there will be plenty of focus on the outlook for RBA policy (more hikes expected) and the Australian economy (wage pressures likely building as the labour market tightens), this has not been a key driver of AUD/USD lately.

AUD/Usd

Overview
Today last price 0.6887
Today Daily Change 0.0031
Today Daily Change % 0.45
Today daily open 0.6856
 
Trends
Daily SMA20 0.7154
Daily SMA50 0.7313
Daily SMA100 0.7251
Daily SMA200 0.7273
 
Levels
Previous Daily High 0.6954
Previous Daily Low 0.6828
Previous Weekly High 0.7267
Previous Weekly Low 0.7029
Previous Monthly High 0.7662
Previous Monthly Low 0.7054
Daily Fibonacci 38.2% 0.6876
Daily Fibonacci 61.8% 0.6906
Daily Pivot Point S1 0.6805
Daily Pivot Point S2 0.6754
Daily Pivot Point S3 0.6679
Daily Pivot Point R1 0.693
Daily Pivot Point R2 0.7005
Daily Pivot Point R3 0.7056

 

 

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 holds above 1.0700 after US inflation data

EUR/USD holds above 1.0700 after US inflation data

EUR/USD stays in the lower half of its daily range but continues to trade above 1.0700 in the early American session on Friday. The data from the US showed that the annual Core PCE Price Index declined to 4.9% in April as expected, making it difficult for the dollar to gather strength.

EUR/USD News

GBP/USD trades above 1.2600 as dollar struggles to find demand

GBP/USD trades above 1.2600 as dollar struggles to find demand

GBP/USD clings to daily gains above 1.2600 and remains on track to end the week in positive territory. The greenback struggles to attract investors after the data from the US showed that PCE inflation softened in April. 

GBP/USD News

Gold pulls away from daily highs, holds above $1,850

Gold pulls away from daily highs, holds above $1,850

Gold has lost its traction in the second half of the day on Friday and declined toward the $1,850 area. The benchmark 10-year US Treasury bond yield staged a modest rebound on the US PCE inflation data, not allowing XAU/USD to preserve its bullish momentum.

Gold News

Terra’s LUNA 2.0 support expands with Binance and Kraken welcoming the airdrop, here’s how you need to prepare

Terra’s LUNA 2.0 support expands with Binance and Kraken welcoming the airdrop, here’s how you need to prepare

Terra’s LUNA fork proposal has passed with 65.5% votes, Revival Plan 2 in action without algorithmic stablecoin UST. LUNA price could wipe out losses incurred by holders in the colossal crash of LUNC and UST. 

Read more

FXStreet Premium users exceed expectations

FXStreet Premium users exceed expectations

Tap into our 20 years Forex trading experience and get ahead of the markets. Maximize our actionable content, be part of our community, and chat with our experts. Join FXStreet Premium today!

BECOME PREMIUM

Forex MAJORS

Cryptocurrencies

Signatures