- AUD/USD remains pressured near weekly low, drops for third consecutive day.
- Treasury yields soared even as Powell tried to ignore bond bears.
- Fed Chair reiterated strong support to the central bank’s status-quo on monetary policy.
- Italy blocks AstraZeneca’s Aussie vaccine supply, NFP in focus.
AUD/USD fails to keep the bounce off 0.7708, recently declining to 0.7720, while taking rounds to the weekly bottom during the initial Asian session on Friday. In doing so, the quote drops for the third day in a row as US Treasury yields stay firm around the fresh yearly top, marked after Fed Chair Jerome Powell’s latest speech.
Bonds aren’t the only problem…
AUD/USD dropped to the lowest since early Monday after Powell shrugged off a recent rally in Treasury yields but couldn’t convince markets. The Fed Chair said that they would be worried about “disorderly market conditions” while reiterating his “above 2.0% inflation” and “sustained employment” goals to trigger the change in the monetary policy.
Following his speech, US 10-year Treasury yields rallied above 1.50% while exerting downside pressure on the Wall Street benchmarks that closed Thursday below 1.0% each. The mood also favored the US dollar index (DXY) which jumped to the highest since December 01, 2020.
Not only the risk-off mood but Italy’s blockage of the AstraZeneca vaccine for Australia also weighs on the AUD/USD. Milan termed Aussie “non-vulnerable” under new EU controls to stop the recently cheered, by Australian PM Scott Morrison, vaccine arrival to Canberra.
It’s worth mentioning that the upbeat prints of Aussie Trade Balance and AiG Performance of Services Index couldn’t defy welcome US economics as markets are more concerned about February’s US employment report, up for publishing today at 13:30 GMT.
As Fed’s Powell followed ECB policymakers to turn down the fears of bond bears and the US stimulus is near to its passage, reflation risks are likely to keep the AUD/USD depressed during the pre-NFP trading lull.
Despite breaking an ascending trend line from November 2020, AUD/USD bears need validation from 50-day EMA, near 0.7700, to retake the controls. Following that, February lows near 0.7560 should return to the chart.
Additional important levels
|Today last price||0.7722|
|Today Daily Change||-61 pips|
|Today Daily Change %||-0.78%|
|Today daily open||0.7783|
|Previous Daily High||0.7838|
|Previous Daily Low||0.777|
|Previous Weekly High||0.8008|
|Previous Weekly Low||0.7692|
|Previous Monthly High||0.8008|
|Previous Monthly Low||0.7562|
|Daily Fibonacci 38.2%||0.7796|
|Daily Fibonacci 61.8%||0.7812|
|Daily Pivot Point S1||0.7757|
|Daily Pivot Point S2||0.773|
|Daily Pivot Point S3||0.7689|
|Daily Pivot Point R1||0.7824|
|Daily Pivot Point R2||0.7865|
|Daily Pivot Point R3||0.7892|
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.