- The AUD/USD reports minimal gains of 0.03% on Monday.
- Higher global bond yields shifted Wall Street sentiment mixed, a headwind for the AUD.
- AUD/USD Price Forecast: Range-bound but skewed to the downside.
The AUD/USD seesaws in a narrow trading range, from daily highs around 0.6958 printed during the Asian session towards daily lows near 0.6910. At 0.6944, the AUD/USD trades above the middle of the aforementioned 0.6910-0.6960 region during the North American session.
The AUD/USD dropped due to falling Iron Ore prices, which declined from $131.45 to $129.71 a ton. Additionally, global bond yields ticked lower on news of fading global recession fears, pushed to the upside after one hour of the Wall Street open, which has shifted the sentiment to mixed, with US equities fluctuating between gains and losses.
In the meantime, the US Dollar Index, a gauge of the greenback’s value against a basket of its rivals, gave up some territory on Monday, down 0.32%, back under the 104.000 mark. Contrarily, the US 10-year Treasury yield grinds higher by close to four basis points and sits at 3.162%.
Analysts at Westpac expect that the AUD/USD could remain afloat at 0.6830
“The Aussie and Kiwi are softest in the G10 over the past week. Fragile risk sentiment and a startling slide in commodity prices are taking a toll. A relatively quiet global calendar suggests that equity sentiment could be pivotal in determining whether AUD/USD can remain clear of May’s lows around 0.6830,” analysts wrote.
In the week ahead, the Australian economic docket will feature Retail Sales for May on its preliminary reading, expected at 0.4%, which is less than the previous reading. On the US front, on Tuesday, CB Consumer Confidence for June is estimated at 100.4, down from May’s 106.4. Other releases include Wholesale Inventories, Trade Balance, Regional Fed Indices reports, and Fed speakers.
AUD/USD Price Forecast: Technical outlook
In the daily chart, the Aussie dollar is still headed to the downside as the week begins. If AUD/USD buyers would like to regain control, they need to reclaim 0.7000 to ease the ongoing selling pressure on the pair. If that is achieved, AUD buyers’ next target would be the 20 EMA at 0.7047, immediately followed by the 50 EMA at 0.7078.
On the flip side, and on the AUD/USD's path of least resistance, the first support comes in at 0.6900, a breach below which would expose the June 23 low at 0.6869, followed by the June 14 swing low at 0.6850.
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 regains traction, recovers above 1.0700
EUR/USD regained its traction and turned positive on the day above 1.0700 in the American session. The US Dollar struggles to preserve its strength after the data from the US showed that the economy grew at a softer pace than expected in Q1.
GBP/USD returns to 1.2500 area in volatile session
GBP/USD reversed its direction and recovered to 1.2500 after falling to the 1.2450 area earlier in the day. Although markets remain risk-averse, the US Dollar struggles to find demand following the disappointing GDP data.
Gold holds around $2,330 after dismal US data
Gold fell below $2,320 in the early American session as US yields shot higher after the data showed a significant increase in the US GDP price deflator in Q1. With safe-haven flows dominating the markets, however, XAU/USD reversed its direction and rose above $2,340.
XRP extends its decline, crypto experts comment on Ripple stablecoin and benefits for XRP Ledger
Ripple extends decline to $0.52 on Thursday, wipes out weekly gains. Crypto expert asks Ripple CTO how the stablecoin will benefit the XRP Ledger and native token XRP.
After the US close, it’s the Tokyo CPI
After the US close, it’s the Tokyo CPI, a reliable indicator of the national number and then the BoJ policy announcement. Tokyo CPI ex food and energy in Japan was a rise to 2.90% in March from 2.50%.