- Aussie buyers cheer upbeat data at home, odds of global monetary easing.
- The pair showed little attention to the trade uncertainty, weak China data.
Having benefited from the macro rush towards commodities/equities, the AUD/USD pair trades modestly flat around 0.7030 during initial Asian morning on Thursday.
Not only markets’ favor for riskier assets while expecting easy monetary policies across the board but upbeat trade and housing data at home also helped the Aussie pair to stay on the top of G10 gainers the previous day.
Elsewhere, the US Dollar (USD) had to bear the burden of sluggish numbers of factory orders, non-manufacturing activity and trade balance. Providing addition burden on the greenback was likely chances of doves dominating the US central bank’s future monetary policy after the US President nominated 2 candidates for the Federal Reserve Board.
Expectations of easy monetary policy drove equities and dragged the bond markets down, the US 10-year treasury yield held below 2.00% to revisit the lowest levels since November 2016.
While the US market holiday is likely to haunt the trading sentiment during the later part of the day, scheduled release of Australia’s seasonally adjusted Retail Sales for May seems the key by now. The Retail Sales growth is expected to reverse previous -0.1% contraction with +0.2%.
Meanwhile, trade developments surrounding the US and global political headlines can also entertain investors during the day.
Technical Analysis
A successful break of 100-day simple moving average (100-DMA) level of 0.7033 becomes necessary for the pair to aim for May month high of 0.7048, late-April top surrounding 0.7070 and 200-DMA level of 0.7098.
Should buyers fail to ignore overbought levels of 14-day relative strength index (RSI), 0.7000 round-figure might offer an intermediate halt to the pullback towards 21 and 50-DMA confluence region around 0.6954/56.
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