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  • AUD/USD rose to its highest level in more than two years.
  • Broad-based selling pressure surrounding USD remains intact.
  • US Dollar Index slumps below 91.00 ahead of US data.

The AUD/USD pair preserved its bullish momentum on Thursday and advanced to its highest level since July 2018 at 0.7437. Although the pair staged a technical correction and edged lower toward 0.7400 during the European trading hours, the broad-based USD weakness allowed it to regain its traction. As of writing, AUD/USD was up 0.12% on the day at 0.7425.

USD selloff continues as focus shifts to mid-tier US data

During the Asian session, the data from Australia showed that the country’s trade surplus expanded to AUD7,456 million in October supported by an impressive 5.4% increase in exports and the upbeat report provided a boost to the AUD. 

In addition to the AUD strength, the selling pressure surrounding the greenback continued to fuel AUD/USD’s rally. After closing the previous two trading days in the negative territory, the US Dollar Index (DXY) extended its slide and plunged to its worst level since April 2018 at 90.83. Following a rebound beyond 91.00, however, the DXY turned south and was last seen losing 0.25% on the day at 90.89.

Later in the day, the US Department of Labor’s weekly Initial Jobless Claims, the IHS Markit’s and the ISM’s Services PMI reports will be watched closely by the market participants. 

In the meantime, the S&P 500 Futures are trading flat on the day, suggesting that the risk sentiment is unlikely to help the safe-haven greenback find demand in the second half of the day.

Technical levels to watch for