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  • Bulls seemed rather unimpressed by the incoming positive trade headlines.
  • A subdued USD demand helped limit the downside, at least for the time being.

The AUD/USD pair filled a modest weekly bearish gap and is currently placed near Friday’s swing high, around the 0.6815-20 region.
The pair failed to capitalize on the previous session’s strong positive move and was off to a cautious start on Monday, shrugging off the incoming positive trade-related headlines. Chinese state media Xinhua said on Sunday the two countries had “constructive talks” on trade in a high-level phone call on Saturday.

Focus remains on trade developments

This comes on the back of the recent comments by US officials, suggesting that they were close to securing a trade deal with China, albeit did little to impress bullish traders. However, a subdued US Dollar price action, amid a modest pullback in the US Treasury bond yields, helped limit any meaningful downside.
In absence of any fresh catalyst, investors seemed reluctant to place any aggressive bets, rather might prefer to wait for any fresh US-China trade developments before positioning for any firm near-term direction amid absent relevant market-moving economic releases on the first day of a new trading week.

Technical levels to watch