AUD/USD seems vulnerable near 0.7200, lowest since October ahead of US data


  • Sustained USD buying dragged AUD/USD to the lowest level since early October.
  • Hawkish Fed expectations, the risk-off impulse acted as a tailwind for the buck.
  • Investors look forward to the US macro data/FOMC minutes for a fresh impetus.

The AUD/USD pair was seen hovering near the lowest level since early October, with bears awaiting a sustained break below the 0.7200 mark heading into the North American session.

Following a brief consolidation through the early part of the trading action on Wednesday, the US dollar regained traction and shot to a fresh 16-month peak amid hawkish Fed expectations. The USD bulls seemed rather unaffected by retreating US Treasury bond yields, instead took cues from the risk-off impulse in the financial markets.

This was evident from a generally weaker tone in the equity markets, which benefitted the greenback's relative safe-haven status and drove flows away from the perceived riskier aussie. Apart from this, the divergence in monetary policy stance between the Reserve Bank of Australia and the Fed further contributed to the AUD/USD pair's ongoing decline.

Meanwhile, Wednesday's downfall could further be attributed to some technical selling following the recent break below support marked by the lower boundary of an upward sloping channel. Some follow-through selling below the 0.7200 mark will reaffirm the negative bias and turn the AUD/USD pair vulnerable to slide further towards the 0.7165 support.

Market participants now look forward to the US economic docket, highlighting the release of the Prelim (second estimate) US Q3 GDP, Durable Goods Orders and Core PCE Price Index. The key focus, however, will be on the FOMC meeting minutes, which will play a key role in driving the greenback in the near term and provide a fresh directional impetus to the AUD/USD pair.

Technical levels to watch

AUD/USD

Overview
Today last price 0.7203
Today Daily Change -0.0026
Today Daily Change % -0.36
Today daily open 0.7229
 
Trends
Daily SMA20 0.737
Daily SMA50 0.7349
Daily SMA100 0.7352
Daily SMA200 0.7528
 
Levels
Previous Daily High 0.7238
Previous Daily Low 0.7206
Previous Weekly High 0.7371
Previous Weekly Low 0.7227
Previous Monthly High 0.7557
Previous Monthly Low 0.7191
Daily Fibonacci 38.2% 0.7226
Daily Fibonacci 61.8% 0.7219
Daily Pivot Point S1 0.7211
Daily Pivot Point S2 0.7193
Daily Pivot Point S3 0.7179
Daily Pivot Point R1 0.7242
Daily Pivot Point R2 0.7256
Daily Pivot Point R3 0.7274

 

 

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