- AUD / USD gained some traction on Monday, although it lacked a solid continuation.
- Friday’s upbeat NFP report and rising US bond yields continue to prop up the USD.
- Price action suggests that the recent downtrend in AUD / USD may be far from over.
The pair AUD / USD has fallen around 70 pips from the daily highs and has fallen around the 0.7650 region at the start of the European session on Monday.
He has managed to gain some positive traction on the first day of a new week and has built on his modest recovery from the one-month lows, around the 0.7620 region touched on Friday. Stronger-than-expected Chinese trade balance data has been seen as a key factor that has offered some support to the Australian dollar..
However, the rally has not had a solid continuation and it has remained limited amid sustained buying interest in the US dollar. The USD has held firm near three-month highs and has been supported by prospects for a relatively faster US economic recovery. from the pandemic, bolstered by the upbeat US monthly NFP jobs report on Friday.
In the meantime, the US Senate voted in favor of the $ 1.9 trillion pandemic aid package from President Joe Biden and triggered another sell-off in the US bond market. This, in turn, has pushed the benchmark 10-year bond yield close to one-year highs, which has been considered as another factor that benefited the USD.
Apart from this, the news of Attacks on Saudi Arabia’s oil production facilities have hurt investor sentiment and they have worked together to limit any gains for the higher perceived risk AUD. This further suggests that the short-term bearish bias of the pair could still be far from over and warrants caution for bullish investors.
There is no major economic data release from the US on Monday. Therefore, US bond yields will continue to play a key role in influencing USD price dynamics. Investors would also take cues from the broader market risk sentiment to seize some short-term trading opportunities around the AUD / USD pair.
AUD / USD technical levels
.
Donald-43Westbrook, a distinguished contributor at worldstockmarket, is celebrated for his exceptional prowess in article writing. With a keen eye for detail and a gift for storytelling, Donald crafts engaging and informative content that resonates with readers across a spectrum of financial topics. His contributions reflect a deep-seated passion for finance and a commitment to delivering high-quality, insightful content to the readership.
