- AUD/USD struggles at 0.7300 as the market mood is risk-averse.
- Evergrande’s failure to pay its bond interest weighs in the AUD.
- Australian Retail Sales and Building Permits for August could provide fresh impetus to AUD/USD.
Earlier in the Asian session, the aussie was trading at daily highs around 0.7310’s, on the back of the positive market sentiment, amid the hawkishness showed by the Federal Reserve on Wednesday monetary policy statement and dot-plot. Nevertheless, Evergrande’s woes and failure to pay the dollar bond coupon changed the market’s mood to risk aversion, thus benefitting the US Dollar. At the time of writing, the AUD/USD is trading at 0.7253, recording a loss of 0.56% during the day.
The Australian dollar is the most exposed to China’s woes – ING
According to ING, the Australian dollar is the most exposed currency for any spillover from a potential Evergrande’s default. The rationale is that Australia is the most Chinese-dependant country in the G10. A collapse in the real estate market would raise further demand concerns in the iron ore market, generating another sell-off in the commodity’s price.
That said, further in the next week, in Australia, the Retail Sales and the Building Permits for August in a month-over-month reading could be catalysts for the AUD/USD pair.
Moreover, the US economic docket is packed with Durable Good Orders, Consumer Confidence for September, GDP monthly and yearly basis figures, Initial Jobless Claims for the week ending on September 23, and the ISM Manufacturing readings for September.
AUD/USD Price Forecast: Technical outlook
Daily chart
The AUD/USD is trading at the mid-point of the trading range of the day.
The price action of the last two candles suggests that a Dark-cloud cover or a bearish-engulfing pattern might be forming. Either way, both have bearish implications. The first one is a weaker signal, and it will need confirmation. The second is a strong signal, though it will require a daily close below 0.7245 to confirm its validity.
In case of that outcome, the first support on the way down would be the September 20 low at 0.7219. A decisive break of the latter could expose the 2021 low at 0.7105.
The Relative Strenght Index is at 43, heading lower, supporting the downtrend.
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 continues to trade in positive territory above 1.0700
EUR/USD has managed to stay in positive territory above 1.0700 despite having retreated modestly in the early American session. ECB President Lagarde reiterated that inflation in the Eurozone is projected to remain too high for too long, helping the Euro keep its footing.
Gold falls below $1,980 as US yields rebound
Gold price has turned south and dropped below $1,980 after having rallied to a fresh multi-month high of $2,010 earlier in the day. The 10-year US Treasury bond yield has turned positive on the day near 3.5% following the sharp decline seen in the European session and weighed on XAU/USD.
GBP/USD rises to fresh multi-week highs above 1.2250
GBP/USD has gathered bullish momentum and advanced to its highest level since mid-February above 1.2250 on Monday. The US Dollar struggles to find demand following a mixed opening in Wall Street and allows the pair to cling to its daily gains.
Bitcoin price primed to revisit $33,000 as global market turmoil rages on
Bitcoin (BTC) price is rallying in a full recovery story after a harsh and long crypto winter through most of 2022. It looks inevitable that BTC will soon take out $30,000 and march higher.
UBS ends Credit Suisse Crisis with $3.25 billion buyout, CS stock purchased for 0.76 CHF
CS is no more. Over the weekend the Swiss National Bank organized a buyout of the struggling bank by the only other Swiss lending giant – UBS.