- The USD remained on the defensive despite a pickup in the US bond yields.
- Improving risk sentiment provided an additional boost and remained supportive.
- The upside is likely to remain capped ahead of Wednesday’s FOMC minutes.
The AUD/USD pair climbed to one-week tops in the last hour, with bulls making a fresh attempt to make it through the 0.6800 round figure mark.
The pair built on the previous session’s modest uptick and continued gaining positive traction for the second consecutive day on Wednesday amid a subdued US Dollar price action. Despite a goodish pickup in the US Treasury bond yields, the greenback failed to attract any meaningful buying interest and was seen as one of the key factors driving the pair higher.
Risk-on mood remains supportive
This coupled with the prevalent risk-on mood, as depicted by a positive trading sentiment around equity markets, provided an additional boost to perceived riskier currencies – like the Aussie – and remained supportive of the ongoing positive momentum, albeit persistent US-China trade tensions might keep a lid on any runaway rally for the major.
Investors might also be reluctant to place any aggressive bullish bets, rather prefer to wait on the sidelines ahead of Wednesday’s important release of the latest FOMC meeting minutes – due later during the US trading session. Hence, it will be prudent to wait for a strong follow-through buying before positioning for any further near-term appreciating move.
Technical levels to watch
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