• Thursday’s mixed Aussie employment details add to RBA rate cut bets.
• The recent escalation in the US-China trade tensions continues to weigh.
• Better than expected US economic data does little to provide any impetus.
The AUD/USD pair’s attempted bounce quickly fizzled out near the 0.6930 region, albeit bulls have managed to defend the 0.6900 handle, at least for now.
With investors looking past today’s mixed Australian employment details, the pair witnessed some intraday short-covering move amid a sudden turnaround in risk sentiment and the ongoing recovery in Oil and Copper prices.
However, a combination of factors – including the recent escalation in the US-China trade tensions and growing bets for an RBA rate cut, kept a lid on any strong follow-through up-move for the China-proxy Australian Dollar.
Meanwhile, the latest leg of a downtick since the mid-European session could further be attributed to a modest pickup in the US Dollar demand, finding some support from a goodish bounce in the US Treasury bond yields.
On the economic data front, better than expected US releases – housing market data, weekly jobless claims and Philly Fed Manufacturing Index, remained supportive of a mild USD bid tone but did little to influence the price action.
The price action now seems to suggest that the recent bearish trajectory might still be far from over, though slightly oversold conditions on the daily chart warrant some near-term consolidation or a modest pullback.
Technical levels to watch