- AUD / USD makes good price movements in both directions on the news of the US election results.
- Uncertainty about the bottom line could prevent investors from opening aggressive directional positions.
The pair AUD / USD has quickly recovered around 70 pips from Asian session lows, set at the 0.7048 level, and has risen above the 0.7100 level again. At the time of writing, the pair is stabilizing around the 0.7110-15 region, still negative on the day.
The pair built on this week’s good rebound from levels below 0.7000 and gained some traction during the early part of the trading action on Wednesday. Increasing odds of a “blue wave” in the US Congress fueled global risk appetite sentiment and weighed heavily on the safe-haven US dollar, which in turn drove money flows into the perceived riskier Australian dollar.
The pair AUD / USD spiked to more than three-week highs, above the 0.7200 level, but had difficulty capitalizing on the movement and made a sharp intraday turn. Current President Donald Trump’s victory in Florida fueled fears of a contested election and provided a good boost to the USD. This has been seen as a key factor behind the strong retracement of the pair around 170 pips.
However, the fact that the vote count may continue for several days and the expected delay in the final result has prevented investors from opening aggressive directional positions. The news indicates that final results from the state of Michigan, a battlefield, will not be available until Wednesday night. Uncertainty justifies some caution for aggressive investors.
Credits: Forex Street

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