“¢ The USD fails to capitalize on the overnight bounce and lends some support.
“¢ Weaker Aussie trade surplus data does little to provide any additional boost.
“¢ The incoming US-China trade-related headlines further capped any strong gains.
The AUD/USD pair extended its sideways consolidative price action through the early European session on Thursday and was seen consolidating the overnight sharp pullback from near four-week tops.
Having failed to find acceptance above the key 0.70 psychological mark, the pair witnessed an intraday bearish turnaround on Wednesday amid a goodish US Dollar rebound. As investors digested Wednesday’s disappointing release of the US ADP report, upbeat US ISM non-manufacturing PMI provided a much-needed respite for the USD bulls.
The pair retreated around 45-pips from daily tops and now seems to have entered a consolidation phase, albeit expectations that the Fed will eventually cut interest rates in 2019 kept a lid on any strong follow-through USD up-move and helped limit further losses at least for the time being.
The pair managed to regain some positive traction during the Asian session on Thursday, though a weaker than expected Australian trade surplus figures failed to inspire bullish traders. This coupled with a flurry of trade-related headlines might further collaborate towards capping any strong gains for the China-proxy Australian Dollar.
There aren’t any major market moving US economic releases due on Thursday and hence, the USD price dynamics might play an important role in influencing the momentum ahead of Friday’s important release of the closely watched US monthly jobs report – popularly known as NFP.
Technical levels to watch
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