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AUD/USD seesaws near 0.7250 despite upbeat China Manufacturing PMI

  • AUD/USD keeps the bounce off intraday low following China’s upbeat data.
  • China NBS Manufacturing PMI improves to 50.3, Non-Manufacturing PMI drops below forecast in December.
  • Off in Japan restricts bond moves, stock futures print mild losses.
  • Omicron woes stay on the table, China increases hardships for Australia but year-end liquidity crunch limit market moves.

AUD/USD seesaws around 0.7255 after China released upbeat official PMI data for December during early Friday. Even so, mixed sentiment and off in major Asia-Pacific markets restrict the Aussie pair’s latest moves.

China’s NBS Manufacturing Purchasing Managers' Index (PMI) grew past 50.1 forecast and prior release to 50.3 in December. The Non-Manufacturing PMI rose to 52.7 versus 52.3 previous readouts but eased below 53.1 market consensus.

It’s worth noting that the year-end liquidity crunch is at its peak during the last day of 2021, with major Asia-Pacific markets off due to New Year’s Eve.

While the same restricts short-term moves of the AUD/USD, mixed concerns over the South African covid variant, namely Omicron, adds to the upside filters for the risk-barometer pair.

Australia’s populous state New South Wales (NSW) again reports a jump in the COVID-19 figures while Victoria also prints an all-time high of 5,919 cases and seven virus-linked death per ABC News. “NSW's daily COVID-19 case tally has nearly doubled for the second time in three days, with 21,151 infections and six deaths recorded,” said ABC News. Even so, the Australian Prime Minister decided to alter the definition of ‘close contact’ with the infected during the emergency National Cabinet Meeting, nothing more.

On the other hand, Reuters’ tally for the US seven-day average of new coronavirus cases refreshes record top for the second consecutive day with 290,000 cases at the latest.

Elsewhere, China’s plan to become self-reliant for iron ore, Australia’s biggest export earner, joins geopolitical tensions over Ukraine and the Sino-American tussles to weigh on the market sentiment.

Alternatively, US policymakers remain hopeful of reaching an agreement over the Build Back Better (BBB) while the global scientists still speak of lesser virus woes ahead.

That said, the Wall Street benchmarks posted mild losses whereas the S&P 500 Futures decline 0.35% at the latest.

Looking forward, an absence of major data/events and the year-end holiday mood will restrict short-term AUD/USD moves.

Technical analysis

A bearish daily candlestick, Gravestone Doji, at the monthly top joins monthly rising wedge’s resistance line and 50% Fibonacci retracement (Fibo.) of October-December downside to highlight 0.7275 as the key hurdle.

That said, 38.2% Fibo. level surrounding 0.7200 is short-term key support before a three-month-old horizontal area near 0.7175-70 will restrict any further downside.

Additional important levels

Overview
Today last price0.725
Today Daily Change-0.0001
Today Daily Change %-0.01%
Today daily open0.7251
 
Trends
Daily SMA200.7166
Daily SMA500.7263
Daily SMA1000.729
Daily SMA2000.7447
 
Levels
Previous Daily High0.7276
Previous Daily Low0.7242
Previous Weekly High0.7253
Previous Weekly Low0.7081
Previous Monthly High0.7537
Previous Monthly Low0.7063
Daily Fibonacci 38.2%0.7255
Daily Fibonacci 61.8%0.7263
Daily Pivot Point S10.7237
Daily Pivot Point S20.7223
Daily Pivot Point S30.7203
Daily Pivot Point R10.727
Daily Pivot Point R20.729
Daily Pivot Point R30.7304

Author

Anil Panchal

Anil Panchal

FXStreet

Anil Panchal has nearly 15 years of experience in tracking financial markets. With a keen interest in macroeconomics, Anil aptly tracks global news/updates and stays well-informed about the global financial moves and their implications.

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