- AUD/USD turns higher for the third straight session amid some renewed USD weakness.
- A sudden pickup in the shared currency prompted some fresh selling around the buck.
- Concerns about escalating US-China tensions kept a lid on any strong gains for the pair.
The AUD/USD pair maintained its bid tone through the mid-European session and was last seen trading comfortably above mid-0.6600s, just below 2-1/2-month tops set earlier this Wednesday.
Following an early dip to the 0.6630 area, the pair regained traction and turned higher for the third consecutive session amid the emergence of some fresh US dollar selling pressure. The greenback struggled to preserve its early gains, instead witnessed an intraday turnaround amid some aggressive buying around the shared currency.
This coupled with the prevalent upbeat market mood, as depicted by some follow-through strength in the global equity markets, extended some additional support to perceived riskier currencies, including the aussie. The risk sentiment remained well supported by the latest optimism about a potential COVID-19 vaccine and hopes of a quick global economic recovery.
The pair shot to an intraday high level of 0.6680, albeit once again failed ahead of the March monthly swing highs. Concerns about a further escalation in diplomatic tensions between the United States and China held investors from placing any aggressive bullish bets and kept a lid on any additional gains for the AUD/USD pair.
It is worth recalling that the US President Donald Trump on Tuesday promised a strong reaction to China's planned national security law for Hong Kong and added that it would be announced by the end of the week. China was quick to retaliate and threatened countermeasures against any US actions, including sanctions.
There isn't any major market-moving US economic data due for release on Wednesday. Hence, it will be prudent to wait for a convincing break through the 0.6680-85 supply zone before traders start positioning for any further near-term appreciating move for the AUD/USD pair.
Technical levels to watch
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 fluctuates near 1.0700 after US data
EUR/USD stays in a consolidation phase at around 1.0700 in the American session on Wednesday. The data from the US showed a strong increase in Durable Goods Orders, supporting the USD and making it difficult for the pair to gain traction.
USD/JPY refreshes 34-year high, attacks 155.00 as intervention risks loom
USD/JPY is renewing a multi-decade high, closing in on 155.00. Traders turn cautious on heightened risks of Japan's FX intervention. Broad US Dollar rebound aids the upside in the major. US Durable Goods data are next on tap.
Gold stays in consolidation above $2,300
Gold finds it difficult to stage a rebound midweek following Monday's sharp decline but manages to hold above $2,300. The benchmark 10-year US Treasury bond yield stays in the green above 4.6% after US data, not allowing the pair to turn north.
Worldcoin looks set for comeback despite Nvidia’s 22% crash Premium
Worldcoin price is in a better position than last week's and shows signs of a potential comeback. This development occurs amid the sharp decline in the valuation of the popular GPU manufacturer Nvidia.
Three fundamentals for the week: US GDP, BoJ and the Fed's favorite inflation gauge stand out Premium
While it is hard to predict when geopolitical news erupts, the level of tension is lower – allowing for key data to have its say. This week's US figures are set to shape the Federal Reserve's decision next week – and the Bank of Japan may struggle to halt the Yen's deterioration.