Nov 07, 2022
VOT Research Desk
On Monday, the AUDUSD pair draws some buying at the 0.6400 level and closes the weekly bearish gap that opened up during the first part of the European session.
The US Dollar struggles to hold onto its modest intraday gains and goes lower for the second straight day, which is regarded as lending some support to the AUDUSD pair.
The pair makes a new daily high in the past hour but fails to sustain it and stays below the psychological level of 0.6500.
The US monthly employment report, which was issued on Friday with a mixed bag of findings, stoked rumors that the Federal Reserve would ease off on the pace at which it tightens monetary policy.
This weighs on the safe-haven greenback and helps the emerging markets, combined with a favorable shift in global risk sentiment.
However, escalating market concerns about the challenges posed by China’s determination to uphold its economically distorting zero-COVID policy may limit the positive action. In addition, higher US Treasury bond rates should support the dollar and help to limit the AUDUSD pair’s upside potential, at least temporarily.
The US consumer inflation data due out on Thursday may provide a new impetus for traders. Even from a technical standpoint, spot prices have not yet confirmed a clear breakthrough through a trend line that descends from the monthly swing high in August.
Given the lack of any significant market-moving economic reports on Monday, aggressive optimistic traders should exercise some caution given the fundamental background.
|
Daily SMA20 |
0.6342 |
|
Daily SMA50 |
0.6531 |
|
Daily SMA100 |
0.6724 |
|
Daily SMA200 |
0.6972 |
