- A strong rebound in Wall Street help risk-sensitive currencies gather strength.
- US Dollar Index clings to modest gains, fails to break above 97.
- Coming up: Inflation report and private sector credit data from Australia.
The AUD/USD took advantage of the housing data in the early Asian session and started the day on a strong note. Although it looked like the pair was struggling to break above 0.71, an improved sentiment and a relatively weaker greenback in the NA session provided an additional boost to the pair and lifted it to a fresh weekly high of 0.7120. As of writing, the pair was up 0.85% on the day at 0.7117.
Earlier today, the Australian Bureau of Statistics reported that building permits increased by 3.3% on a monthly basis in September following August's 8.1% decline and surpassed the analysts' estimate of 3%.
On the other hand, after facing resistance near the 97 mark, the US Dollar Index started to consolidate its daily gains and was last seen up 0.15%on the day at 96.82 to help the pair extends its rally. Furthermore, the positive mood in the session with all three major indexes in the United States adding more than 1% is ramping up the demand for risk-sensitive currencies such as the AUD.
On Tuesday, the Reserve Bank of Australia will publish its Private Sector Credit data. More importantly, the Australian Bureau of Statistics will release the CPI figures, which is expected to ease to 1.9% in the third quarter from 2.1%. A softer-than-expected inflation growth in Australia could put the AUD under bearish pressure as it would allow the RBA to continue to stay dovish.
Technical levels to consider
The next target for the pair on the upside is located at 0.7150 (50-DMA) ahead of 0.7200 (psychological level/Oct. 3 high) and 0.7240 (Oct. 2 high). On the other hand, supports could be seen at 0.7100 (20-DMA), 0.7045 (Oct. 29 low) and 0.7000 (psychological level).
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
AUD/USD: Extra gains in the pipeline above 0.6520
AUD/USD partially reversed Tuesday’s strong pullback and regained the 0.6500 barrier and beyond in response to the sharp post-FOMC pullback in the Greenback on Wednesday.
EUR/USD meets support around 1.0650
EUR/USD managed to surpass the key 1.0700 barrier in response to the intense retracement in the US Dollar in the wake of the Fed’s interest rate decision and Chair Powell’s press conference.
Gold surpasses $2,300 as Dollar tumbles
The precious metal maintains its constructive stance and trespasses the $2,300 region on Wednesday after the Federal Reserve left its FFTR intact, matching market expectations.
Bitcoin price reclaims $59K as Fed leaves rates unchanged
The market was at the edge of its seat on Wednesday to see whether the US Federal Reserve (Fed) would cut interest rates during the Federal Open Market Committee (FOMC) meeting.
The market welcomes the Fed's statement
The market has welcomed the Fed statement, and the S&P 500 is higher in its aftermath, the dollar is lower and Treasury yields are falling. There is still only one cut priced in by the Fed.