AUD/USD recovers early lost ground, flat-lined above 0.7600 mark

AUD/USD staged a goodish bounce amid a modest USD pullback from multi-month tops.
Recovering US equity futures prompted some profit-taking around the safe-haven USD.
The attempted recovery runs the risk of fizzling out rather quickly and remain limited.

Haresh Menghani FXStreet

The AUD/USD pair has recovered around 35-40 pips from daily swing lows and was last seen trading in the neutral territory, near the 0.7620-25 region.

A modest bounce in the US equity futures prompted some profit-taking around the safe-haven US dollar and extended some support to the perceived riskier aussie. This, in turn, was seen as a key factor that assisted the AUD/USD pair to stage a modest bounce from the 0.7585-80 region, just ahead of YTD lows.

The AUD/USD pair, for now, seems to have stalled its recent sharp pullback from monthly tops, around mid-0.7800s, touched in the aftermath of the dovish FOMC statement last week. That said, any meaningful recovery seems elusive amid the underlying bullish sentiment around the USD, supported by the upbeat US economic outlook.

Investors remain optimistic about the prospects for a relatively faster US economic recovery amid the impressive pace of COVID-19 vaccinations and the passage of a massive stimulus package. Moreover, renewed COVID-19 jitters, potential US tax hikes, diplomatic tensions between China and the West might further cap the AUD/USD pair.

Hence, the intraday recovery might still be categorized as a short-covering bounce from oversold conditions on hourly charts and runs the risk of fizzling out rather quickly. Hence, it will be prudent to wait for some strong follow-through buying before confirming that the AUD/USD pair has bottomed out.

Market participants now look forward to the US economic docket, highlighting the release of Durable Goods Orders and flash PMI prints for March. Apart from this, Fed Chair Jerome Powell's second day of testimony and the broader market risk sentiment might further contribute to produce some trading opportunities around the AUD/USD pair.

Technical levels to watch

AUD/USD

Overview
Today last price	0.7625
Today Daily Change	0.0016
Today Daily Change %	0.21
Today daily open	0.7609

Trends
Daily SMA20	0.7756
Daily SMA50	0.7739
Daily SMA100	0.7609
Daily SMA200	0.7363

Levels
Previous Daily High	0.775
Previous Daily Low	0.7609
Previous Weekly High	0.785
Previous Weekly Low	0.7698
Previous Monthly High	0.8008
Previous Monthly Low	0.7562
Daily Fibonacci 38.2%	0.7663
Daily Fibonacci 61.8%	0.7696
Daily Pivot Point S1	0.7562
Daily Pivot Point S2	0.7514
Daily Pivot Point S3	0.742
Daily Pivot Point R1	0.7703
Daily Pivot Point R2	0.7797
Daily Pivot Point R3	0.7844

Author

Haresh Menghani

FXStreet

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

GBP/USD revisits 1.3530; Dollar pushes harder

GBP/USD adds to the weekly correction and recedes toward the 1.3530 zone on Friday. Indeed, Cable faces increasing selling pressure on the back of extra gains in the Greenback, particularly fuelled by Chair Warsh’s speech at the Jackson Hole Symposium and the US NFP Annual Revision (-79K).

EUR/USD breaches below 1.1600, multi-day lows

EUR/USD now accelerates its decline and retreats to seven-day troughs in the sub-1.1600 region at the end of the week. The pair’s pullback comes on the back of the strong rebound in the US Dollar after Chair Warsh delivered a hawkish message in Jackson Hole, while the US NFP Annual Revision came in at -79K.

Gold seems vulnerable above $4,450 as Fed hike bets, Iran risks support USD

Gold recovers slightly from a one-and-a-half-week low, touched during the Asian session on Monday, though any meaningful recovery seems elusive. Fed Chair Kevin Warsh’s Jackson Hole speech was perceived as hawkish, raising expectations for a September rate hike. Adding to this, fresh US strikes on Iran keep the geopolitical risk premium in play, which acts as a tailwind for the safe-haven US Dollar and should cap the bullion.

Week ahead: RBNZ and BoC decide on rates ahead of all-important US NFP

The US dollar staged a modest recovery this week, perhaps as traders decided to cover some of their short positions amid slightly stickier or in-line US PCE inflation numbers for July, confounding expectations of softer prints amid the softness revealed in the CPI data for the month.

CFTC Report: CAD short covering leads; Gold buying surges

The week in one sentence: speculative positioning shifted more constructively in the week to August 25. CAD short covering led the move, followed by a broad reduction in EUR shorts and renewed Gold buying. GBP and VIX positioning also improved, while JPY positioning deteriorated and WTI flows diverged from weaker prices.

Diesel’s record $100 warning: The oil shock hiding in plain sight

The Oil market may look calmer than it did a few months ago, but diesel is sending a very different message. The US diesel crack spread, the premium of ultra-low sulphur diesel futures over WTI, recently surged above $100 per barrel for the first time, reaching an intraday record of just over $102.00.