- AUD/USD snaps two-week downtrend, holds lower grounds on a day.
- Optimism surrounding Evergrande, Fed and US stimulus backed the biggest daily jump in a month.
- IMF cuts 2021 Aussie GDP forecast, China battles power problems as market awaits Evergrande coupon payment.
- Light calendar may favor consolidation, news from Beijing, Fedspeak eyed.
AUD/USD flirts with 0.7300, teasing intraday low, amid early Friday.
The risk barometer jumped the most since late August the previous day to refresh the monthly peak, pushing the quote towards the first weekly gain in three. However, the latest moves have been sluggish of late.
While tracing the pullback, the International Monetary Fund’s (IMF) downgrade of Australia's GDP forecast for 2021 gains major attention. On the same line was the market’s anxiety as traders await Evergrande’s scheduled bond coupon payment. Furthermore, comments from China’s National Development and Reform Commission (NDRC) suggesting issues of rising raw material prices and power limits tame the AUD/USD bulls.
On the contrary were comments from Australia Treasury Josh Frydenberg who said, “significant growth expected post-Delta.”
That said, the Fed’s rate hike and tapering signals, coupled with Chinese help to Evergrande and progress over the US $3.5 trillion stimulus talks favored the market sentiment, as well as AUD/USD prices on Thursday.
Against this backdrop, the US 10-year Treasury yields refresh 11-week top to 1.43%, following the heaviest daily jump since February. Further, the S&P 500 Futures rise 0.15% intraday during the three-day rebound at the latest.
Moving on, a slew of Federal Reserve (Fed) speakers, including Chairman Jerome Powell, are slated for speeches during Friday, likely making the dull active going forward. Also important is the US New Home Sales for August, expected 0.7M versus 0.708M prior, as well as headlines relating to China’s embattled real-estate firm and US stimulus.
Technical analysis
AUD/USD bulls need validation from 50-DMA, near 0.7330, to extend the 13-day-old trend line breakout, around 0.7250 by the press time.
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 holds gains near 1.0650 amid risk reset
EUR/USD is holding onto its recovery mode near 1.0650 in European trading on Friday. A recovery in risk sentiment is helping the pair, as the safe-haven US Dollar pares gains. Earlier today, reports of an Israeli strike inside Iran spooked markets.
GBP/USD recovers toward 1.2450 after UK Retail Sales data
GBP/USD is rebounding toward 1.2450 in early Europe on Friday, having tested 1.2400 after the UK Retail Sales volumes stagnated again in March, The pair recovers in tandem with risk sentiment, as traders take account of the likely Israel's missile strikes on Iran.
Gold price defends gains below $2,400 as geopolitical risks linger
Gold price is trading below $2,400 in European trading on Friday, holding its retreat from a fresh five-day high of $2,418. Despite the pullback, Gold price remains on track to book the fifth weekly gain in a row, supported by lingering Middle East geopolitical risks.
Bitcoin Weekly Forecast: BTC post-halving rally could be partially priced in Premium
Bitcoin price shows no signs of directional bias while it holds above $60,000. The fourth BTC halving is partially priced in, according to Deutsche Bank’s research.
Geopolitics once again take centre stage, as UK Retail Sales wither
Nearly a week to the day when Iran sent drones and missiles into Israel, Israel has retaliated and sent a missile into Iran. The initial reports caused a large uptick in the oil price.