AUD/USD tumbles to three-week lows as the US dollar strengthens further


  • Greenback gains momentum amid higher yields and risk aversion. 
  • AUD/USD heads for second weekly decline in a row. 

The AUD/USD dropped further and is trading at 0.7265, the lowest level in three weeks. The aussie is about to post the second weekly loss in a row amid a stronger US dollar

The breakout of the US 10-year yield above 1.35% boosted the greenback across the board. The DXY is at 93.15, up 0.31%, at the highest level since August 27. The modestly lower than expected reading of UoM Consumer Confidence did not weakened the dollar. At the same time, equity prices in Wall Street are falling. The risk aversion weighs on the aussie. The Dow Jones falls 0.52% and the Nasdaq 0.80%. 

Week ahead: FOCM and RBA minutes 

Market volatility will likely continue next week with the FOMC meeting. The Federal Reserve is expected to keep monetary policy unchanged; analysts will look for clues about the future of the QE program. 

According to analysts at TD Securities, Fed’s officials will likely signal that they are almost ready to taper the purchase program. “We expect a formal announcement in December, not November, but we will review our forecast after the meeting. While median 2022-23 dot-plot projections will likely be unchanged, the math makes any changes much more likely to be up than down. The 2024 dot plot will likely show further, gradual tightening. Median inflation/growth projections for 2021 will have to be raised/cut.”

In Australia, the key report will be the Reserve Bank of Australia minutes. “Governor Lowe laid out the case for the RBA's Sep taper decision in his recent speech, but we think the minutes could showcase a debate among the Board on other G10 CBs' future monetary policy settings and its implications for RBA's QE path. Discussion over housing could be more prominent and if bank lending is indeed being "maintained" even as the property market runs red-hot”, argue analysts at TDS. 

Technical levels

AUD/USD

Overview
Today last price 0.7278
Today Daily Change -0.0009
Today Daily Change % -0.12
Today daily open 0.7287
 
Trends
Daily SMA20 0.7325
Daily SMA50 0.735
Daily SMA100 0.7511
Daily SMA200 0.7606
 
Levels
Previous Daily High 0.7348
Previous Daily Low 0.7274
Previous Weekly High 0.7469
Previous Weekly Low 0.7345
Previous Monthly High 0.7427
Previous Monthly Low 0.7106
Daily Fibonacci 38.2% 0.7302
Daily Fibonacci 61.8% 0.7319
Daily Pivot Point S1 0.7258
Daily Pivot Point S2 0.7229
Daily Pivot Point S3 0.7184
Daily Pivot Point R1 0.7332
Daily Pivot Point R2 0.7377
Daily Pivot Point R3 0.7406

 

 

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