AUDUSD pair surrenders its slight intraday gains to the 0.6425-0.6430 zone, hovering at the lower end.
During the early European session on Friday, the AUDUSD pair surrenders its slight intraday gains to the 0.6425-0.6430 zone. Hovering at the lower end of its daily range. Spot prices are currently trading around the 0.6400 round-figure mark. Well within striking distance of the previous day’s bottom since November 2022.
Despite stimulus negotiations, China’s economic difficulties remain a headwind for the Australian dollar.
After discussions of new Chinese stimulus measures, fears over the world’s second-largest economy continue to act as a drag. Antipodean currencies, especially the Australian Dollar (AUD), face a headwind. The fact that China Evergreened Group, one of the country’s largest real estate developers, has applied for creditor protection in a US bankruptcy court exacerbated the anxieties. This adds to concerns over a worsening property crisis. In China and keeps the AUDUSD pair’s tiny intraday rise in check.
The Fed’s hawkish stance supports the USD and helps to keep the major under control.
Aside from that, the poor domestic jobs data. On Thursday pretty much indicates another on-hold rate decision by the Reserve Bank of Australia (RBA) in September. Further undermining the Australian dollar. The US Dollar (USD), on the other hand, reverses a minor intraday loss and stands at its best level in more than two months as expectations rise. that the Federal Reserve (Fed) will continue to raise interest rates. This helps to keep any major rise for the AUDUSD pair in check.
However, the Relative Strength Index (RSI) on the daily chart is already indicating oversold conditions, discouraging traders from planning for more losses in the absence of any important US economic data. Nonetheless, the fundamental backdrop appears to be heavily skewed in favor of bearish traders, implying that the path of least resistance for the AUDUSD pair is to the downside.
