AUD/USD seesaws near 3-week top ahead of Australia trade balance

• AUD/USD catches a breath around three-week high amid a lack of major catalysts.
• RBA, GDP and improvement in risk sentiment back the Aussie’s up-move.
• Australia trade balance is in the spotlight for now while trade/political news, US data will drive markets afterward.

Amid a lack of fresh directives, the AUD/USD pair buyers catch a breath around the highest since mid-August while taking rounds to 0.6800 during early Thursday morning in Asia.

The Aussie pair recently witnessed the support of the Reserve Bank of Australia’s (RBA) refrain from providing clear clues of October rate cut and the second quarter (Q2) gross domestic product (GDP) growth that matched market expectations of 1.4% on a yearly basis and 0.5% QoQ.

It should also be noted that receding odds of a no-deal Brexit and upbeat tone of the Fed’s Beige Book offered additional support to the market’s risk tone.

On the contrary, geopolitical tension surrounding Iran and no clues on the US and Chinese trade diplomats’ meeting, initially pointed towards the current month, question market optimism.

Moving on, traders will now keep an eye over the July month trade balance numbers from Australia while trade/political news can offer intermediate moves to markets ahead of the busy economic calendar from the US.

Australia’s Trade Balance is expected to witness a pullback to 7,400M from 8,036M with previous Imports and Exports growth being -4% and 1% respectively. Further, the US economic line includes August month’s ADP Employment Change, ISM Non-Manufacturing Purchasing Managers’ Index (PMI) and Factory Orders for July.

Technical Analysis

August 08 high close to 0.6825 becomes immediate upside barrier to break in order to aim for 50-day exponential moving average (EMA) level of 0.6840. On the contrary, a downside break of 21-day EMA level of 0.6780 can fetch the quote back to 0.6735 and 0.6700 rest-points.