- AUD/USD is trading below 0.7400 after closing in the green last week.
- US Dollar Index is staging a rebound on Monday.
- The market mood turns cautious at the start of the week.
The AUD/USD pair closed the fifth straight week in the positive territory last week but struggled to push higher on Monday. As of writing, the pair was down 0.44% on a daily basis at 0.7389.
AUD fails to capitalize on strong Chinese data
Earlier in the day, the data published from China showed that the Trade Balance in November rose to $75.42 billion and surpass the market expectation of $53.5 billion. Additionally, Exports rose by 21.1% on a yearly basis. Despite the upbeat data, the AUD struggled to find demand as investors seem to have adopted a cautious stance.
Fading hopes for an EU-UK trade deal is causing major European equity indexes to trade in the negative territory and allowing the greenback to attract investors as a safe-haven. At the moment, the US Dollar Index is up 0.35% at 91.02. Reflecting the dismal market mood, the S&P 500 Futures are also losing 0.4% at 3,681.
The only data featured in the US economic docket will be October Consumer Credit Change. However, market participants’ risk perception is likely to remain the primary driver in the second half of the day. If Wall Street’s main indexes stage a deep correction following last week’s gains, the USD could preserve its strength and keep the bearish pressure on AUD/USD intact.
In the early trading hours of the Asian session on Tuesday, the National Australia Bank’s Business Confidence and third-quarter House Price Index figures from Australia will be looked upon for fresh catalysts.
Technical levels to watch for
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