- The CNY’s rebound helps the AUD on Thursday.
- US Dollar Index extends its corrective fall.
- Improved sentiment allows commodities to recover.
The sharp fall witnessed in the USD/CNY pair during the Asian session provided a boost to the AUD and the AUD/USD pair recovered almost all of the losses that it suffered since the start of the week. At the moment, the pair is trading at 0.7280, adding 0.55% on the day. Meanwhile, according to the Australian Bureau of Statistics, the unemployment rate in Australia ticked down to 5.3% in July to beat the analysts’ estimate of 5.4%.
Today’s data from the U.S. showed that the weekly initial jobless claims fell to 212K from 214K and the building permits increased by 1.5% in July following a 0.7% decline. However, a less-than-expected growth in housing starts and a sharp fall witnessed in the Philly Fed Manufacturing Index offset the potential positive impact of the strong data and didn’t allow the US Dollar Index to gain traction. At the moment, the DXY is down 0.27% on the day at 96.45.
On the other hand, the commodity-related aussie is also taking advantage of a healthy rebound witnessed in copper, which is up more than 3% on a daily basis. Additionally, the improved sentiment on Thursday help risk-sensitive currencies stay strong against the buck.
Technical outlook
Short-term supports for the pair are located at 0.7200 (psychological level/Aug. 15 low), 0.7160 (Dec. 23, 2016, low) and 0.7100 (psychological level). On the upside, resistances align at 0.7300 (psychological level/Aug. 12 high), 0.7360 (20-DMA) and 0.7450 (Aug. 9 high).
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