AUD / USD struggles to regain 0.7500, coronavirus, Chinese trade data in sight – .

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AUD / USD struggles to regain 0.7500, coronavirus, Chinese trade data in sight – .


  • AUD / USD is looking for a clear direction around its annual low after a calm start to the week.
  • Concerns about Covid remain high in Australia with the highest counts since early September.
  • Australian authorities prepare more stimulus measures as virus outbreaks suggest prolonged local shutdowns.
  • Premier Morrison’s speech, Chinese trade figures for June and the US CPI will be key.

AUD / USD is hovering around 0.7480, after a quiet start to the week around annual low, early Tuesday morning in Asia. The pair fail to encourage new stock records amid the coronavirus (COVID-19) at home and a lack of major catalysts, highlighting today’s Chinese trade figures and the US consumer price index (CPI) for further impetus.

Other blockages …

With the highest number of new confirmed cases in more than 10 months, around 120 by ABC News, Australia’s covid activity restrictions are likely to be stretched. Conditions in New South Wales (NSW) are becoming worrying, prompting Prime Minister Scott Morrison, NSW Premier Gladys Berejiklian and other policymakers to discuss the aid package overnight.

The United States seeks to cautiously ease activity restrictions linked to the virus as British authorities confirm the unlock on July 19 even as cases of the virus have skyrocketed in recent times.

Alternatively, New York Federal Reserve Chairman John Williams said, according to Reuters, “The US economy has failed to make the ‘further substantial progress’ set by the US Federal Reserve to begin cutting back on purchases of gasoline. ‘assets. His comments bolster hopes of extended easy currency and preferred stock.

Against this backdrop, earnings optimism favored US equity indices to refresh record highs while US Treasury yields also rose 1.2 basis points (bps) at the end of the North American session of Monday.

Next, the National Australia Bank (NAB) business confidence and trading conditions figures for June, paired with China’s trade balance, imports and exports for this month, will be the key data. in Asia, followed by the US CPI for last month. While the NAB data may print mixed results, the likely weakness in Chinese trade figures, coupled with COVID-19 issues) could continue to weigh on AUD / USD prices. However, the expected announcement of a fiscal stimulus for NSW could offer an intermediate rebound for the pair.

Technical analysis

AUD / USD remains below a 12 day old resistance line near 0.7505 despite rebounding from August-September highs late last week around 0.7415. It should be noted, however, that the MACD line teases short term bulls and therefore an upside clearance of 0.7505 could trigger a corrective pullback towards the 200-DMA level of 0.7581.

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