- AUD/USD came under renewed selling pressure on Wednesday amid resurgent USD demand.
- Recession fears continued weighing on investors’ sentiment and benefitted the safe-haven USD.
- Traders now eye US Durable Goods Orders for some impetus ahead of the FOMC meeting minutes.
The AUD/USD pair witnessed an intraday turnaround from the 0.7120 region on Wednesday and continued losing ground through the mid-European session. The downward trajectory dragged spot prices back closer to the weekly low, below mid-0.7000s, and was sponsored by resurgent US dollar demand.
In fact, the key USD Index staged a solid rebound from a nearly one-month low touched the previous day and was supported by growing concerns about softening global economic growth. The prospects for a more aggressive move by major central banks to constrain inflation, the Russia-Ukraine war and the latest COVID-19 outbreak in China have been fueling recession fears.
The worries continued weighing on investors' sentiment, which was evident from a generally weaker tone around the equity markets. This, in turn, helped revive demand for the safe-haven greenback and drove flows away from the perceived riskier aussie. Apart from this, a strong intraday USD uptick could further be attributed to some repositioning trade ahead of the FOMC minutes.
A 50 bps Fed rate hike move at the next two meetings is fully priced in and hence, market participants will look for clues about the possibility of a jumbo rate hike in June. This will play a key role in influencing the USD price dynamics and provide a fresh directional impetus to the AUD/USD pair. In the meantime, traders might take cues from the US Durable Goods Orders data.
Technical levels to watch
|Today last price||0.7052|
|Today Daily Change||-0.0052|
|Today Daily Change %||-0.73|
|Today daily open||0.7104|
|Previous Daily High||0.7114|
|Previous Daily Low||0.7056|
|Previous Weekly High||0.7074|
|Previous Weekly Low||0.6872|
|Previous Monthly High||0.7662|
|Previous Monthly Low||0.7054|
|Daily Fibonacci 38.2%||0.7078|
|Daily Fibonacci 61.8%||0.7092|
|Daily Pivot Point S1||0.7069|
|Daily Pivot Point S2||0.7033|
|Daily Pivot Point S3||0.701|
|Daily Pivot Point R1||0.7127|
|Daily Pivot Point R2||0.715|
|Daily Pivot Point R3||0.7186|
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