AUD/USD retreats from multi-month tops, still well bid near 0.6930-35 region

The AUD/USD pair retreated over 50 pips from five-month tops, albeit has still managed to trade modest daily gains around the 0.6930-40 region. The US  |  03/06/2020 08:36
  • AUD/USD gained traction for the fifth straight session on Wednesday amid sustained USD selling.
  • Mostly in line domestic GDP report remained supportive of the strong bid tone around the aussie.
  • Overbought conditions prompted some profit-taking and led to a modest pullback from daily tops.

The AUD/USD pair retreated over 50 pips from five-month tops, albeit has still managed to trade modest daily gains around the 0.6930-40 region.

The US dollar selling bias remained unabated through the early part of Wednesday's trading action and assisted the AUD/USD pair to prolong its recent bullish trajectory. Growing optimism about a global economic recovery helped offset concerns over US-China tensions and rising social unrest in the United States, which, in turn, kept the safe-haven greenback under pressure.

Apart from the prevalent risk-on mood, the perceived riskier aussie was further supported by mostly in line Australian GDP figures. In fact, Australia’s first-quarter GDP came in to show a contraction of 0.3% and the yearly rate stood at 1.4%. The AUD/USD pair climbed to the highest level since early March, albeit stalled the momentum ahead of the key 0.7000 psychological mark.

The pullback lacked any obvious catalyst and could be solely attributed to some profit-taking amid extremely overbought conditions on short-term charts. Given the AUD/USD pair's rally over around 500 pips since last Thursday, traders seemed inclined to take some profits off the table. This makes it prudent to wait for some follow-through selling before confirming that the pair might have topped out in the near-term.

Moving ahead, market participants now look forward to the US macro data for a fresh impetus later during the early North American session. Wednesday's US economic docket highlights the release of the ADP report on private-sector employment, which will be followed by the ISM Non-Manufacturing PMI for May.

The data might influence the USD price dynamics, which along with the broader market risk sentiment will play a key role in producing some meaningful trading opportunities. The market focus will then shifts to Friday's release of the closely watched US monthly jobs report, popularly known as NFP.

Technical levels to watch

 

Share

Popular News

Show More Popular News

Market Insight's Views

Market Insight analyses will provide both fundamental and technical comprehensions on FX
and other asset classes for Market Insight viewers

RISK WARNING

The information provided herein is for general informational and educational purposes only. It is not intended and should not be construed to constitute advice.

If such information is acted upon by you then this should be solely at your discretion and GKFX will not be held accountable in any way.

  • ForexF
  • IndicesI
  • CommoditiesC
        Back

        Login to Market Insight Account

        Your Market Insight account gives you access to the tools that we offer our customers including our
        Technical Studies & Sentiment for your accounts.

        Forgot Password?

        Don't you have a Market Insight account? With a few easy steps you can easily register to Market Insight

        Create a Market Insight's Account

        Your Market Insight account gives you access to the tools that we offer our customers including our Technical Studies & Sentiment for your accounts.

        register_ty

        Thank you!

        Welcome to Market Insight family!

        You have succesfully completed the registration.
        We will send you an e-mail to give you some
        instructions and our Terms and Conditions!
        Our account representatives will be contacting you as
        soon as possible. If you have any further questions
        please do not hesitate to mail us via info@marketinsight.com