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AUD/USD reverses its course, edges towards 0.6910s

  • AUD/USD finished the week above 0.6900, up 0.04%.
  • Consumer Sentiment in the United States improved while inflation expectations rose.
  • AUD/USD traders are eyeing RBA’s Governor speech alongside the Aussie employment situation.
  • Next week’s US inflation and retail sales would dictate the faith of the US Dollar.

The Australian Dollar (AUD) is set to finish Friday’s session with minimal losses of 0.22%, ahead of a busy week in the United States (US) economic calendar, led by inflation data. Additionally, a mixed market sentiment bolstered appetite for the greenback, which finished the week with solid gains of 0.56%. At the time of writing, the AUD/USD is trading at 0.6918 after hitting a high of 0.6960.

Wall Street closed mixed, with the S&P 500 and the Dow Jones registering gains of 0.22% and 0.50%, each at 4,090.46 and 33,869.27, respectively. Contrarily, the Nasdaq 100 dived 0.61%,  down to 11,718.12. Data reported in the US economic calendar witnessed the University of Michigan’s Consumer Sentiment, which exceeded expectations and reached 66.4, showing an improvement in financial conditions. Moreover, the projected inflation rate for the upcoming year has increased from 3.9%, as reported in January’s final reading, to 4.2%. On the other hand, the estimated inflation rate for a five-year span remains unchanged at 2.9%.

The AUD/USD reversed its course on the data and, from around 0.6949, ready to test the day’s highs, dropped back towards the 0.6919 area.

The US Dollar Index (DXY), which tracks the American Dollar (USD) performance against a basket of six currencies, finished the week at around 103.585, up 0.58%, a headwind for the AUD/USD.

On the Australian front, Australian bond yields rose,  capping the Australian Dollar (AUD) fall against the greenback. Market participants ramped up expectations for additional interest rate increases by the RBA, which hiked rates by 25 bps on Tuesday, and stated that further tightening would be needed after lifting rates to the 3.35% threshold.

What to watch?

The week ahead, the Australian economic docket will feature two speeches by the Reserve Bank of Australia Governor Philip Lowe, alongside Employment data. On the US front, the calendar will release inflation data, Retail Sales, and Regional Federal Reserve Bank will reveal manufacturing conditions.

AUD/USD key technical levels

AUD/USD

Overview
Today last price0.6919
Today Daily Change-0.0013
Today Daily Change %-0.19
Today daily open0.6932
 
Trends
Daily SMA200.7004
Daily SMA500.6867
Daily SMA1000.668
Daily SMA2000.6807
 
Levels
Previous Daily High0.7011
Previous Daily Low0.6921
Previous Weekly High0.7158
Previous Weekly Low0.6919
Previous Monthly High0.7143
Previous Monthly Low0.6688
Daily Fibonacci 38.2%0.6977
Daily Fibonacci 61.8%0.6956
Daily Pivot Point S10.6899
Daily Pivot Point S20.6865
Daily Pivot Point S30.6809
Daily Pivot Point R10.6989
Daily Pivot Point R20.7045
Daily Pivot Point R30.7079

Author

Christian Borjon Valencia

Markets analyst, news editor, and trading instructor with over 14 years of experience across FX, commodities, US equity indices, and global macro markets.

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