- AUD/USD fades Thursday’s advance and recedes to 0.7630.
- The Aussie dollar faces selling pressure on USD-strength.
- The RBA is expected to keep rates on hold on Tuesday.
The better note in the greenback hurts the risk complex and forces AUD/USD to recede to daily lows in the 0.7630 region on Friday.
AUD/USD now looks to RBA
AUD/USD resumes the downside on Friday on the back of the resumption of the demand for the US dollar in a context where the risk aversion is poised to dominate the sentiment.
In fact, the pair came under extra selling pressure this week and briefly tested sub-0.7600 levels on Thursday, or new 2021 lows, although it later managed to reverse the drop and close the day with decent gains.
In the domestic docket, Producer Prices rose 0.5% QoQ during the October-December period while contracted 0.1% on a yearly basis. Further data saw the Housing Credit expanding 0.4% during December and the Private Sector Credit growing at a monthly 0.3% in December.
Moving forward, all the attention is expected to gyrate around the next RBA event on Tuesday. Investors’ interest in the central bank’s gathering picked up steam in light of the recent improvement in the Australian labour market and inflation prospects going forward.
AUD/USD levels to watch
At the moment the pair is retreating 0.40% at 0.7646 and faces the next support at 0.7591 (2021 low Jan.28) seconded by 0.7550 (55-day SMA) and then 0.7461 (weekly low Dec.21 2020). On the upside, a break above 0.7722 (21-day SMA) would expose 0.7782 (weekly high Jan.21) and finally 0.7820 (2021 high Jan.6).
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