Jump to content

AUD/USD Bounces as US Dollar Digests Powell Pivot and Data Beat. Where To From Here?


Recommended Posts

AUSTRALIAN DOLLAR, AUD/USD, CRUDE OIL, US DOLLAR, DXY, FED, POWELL - TALKING POINTS

  • AUD/USD rallied in Asia as risk appetite recovered post-Powell
  • APAC equities were mainly higher, crude still vulnerable before OPEC+
  • Yields and base metals found higher ground. Can AUD/USD catch a bid?

AUD/USD Bounces as US Dollar Digests Powell Pivot and Data Beat. Where To  From Here?

 

The Australian Dollar rejected a new low for the year as the fall-out from Federal Reserve Chairman Jerome Powell’s testimony to the Senate Banking Committee continues.

US Treasuries continue to see higher yields in the Asian session, particularly in the short-end, with the 2-year bond trading above 0.60%.

Mr Powell said that the economy is strong and inflationary pressures are high. He looked at the next Fed meeting for a discussion to wrap up the asset purchasing program a few months earlier than previously anticipated. In his remarks, he retired the reference to ‘transitory’ inflation.

The US Dollar Index (DXY) initially spiked higher on the comments but pulled back to near where it was before the testimony. On that USD rally, AUD/USD hit a new low for 2021 but then spent the ensuing hours recovering.

The Australian Dollar then got a boost after third quarter GDP numbers came in at -1.9% for the three months through September, above expectations of -2.7%. The annual number was 3.9% against forecasts of 3.0%.

Iron ore prices also rose again today and are now more than 18% above the lows seen last month. Other base metals had small gains in Asia.

WTI crude oil continues to remain under pressure below US$68 a barrel, a long way from US$78 a barrel prior to the Omicron variant outbreak news.

The discussion at the OPEC+ meeting on Thursday might shift away from concerns about the release of strategic petroleum reserves and focus on the possible impacts of the new mutation of Covid-19. A cut in output could still be on the table.

APAC equities shrugged off the negative Wall Street lead to be mostly positive on the day. Korea’s Kospi index was the best performer while Australia’s ASX 200 was slightly down.

Later today, the US will see data on mortgages, jobs, construction and manufacturing PMI. We are also due to hear from Federal Reserve Chair Jerome Powell and US Treasury Secretary Janet Yellen again.

 

AUD/USD TECHNICAL ANALYSIS

AUD/USD bounced off a 1-year low in the last session and the previous low at 0.71062 might now provide a point of support. The low seen at 0.70626 could also be a support level.

The price is currently below all short, medium and long-term simple moving averages (SMA). This may suggest that bearish momentum might continue to evolve.

On the topside, potential resistance might lie at the pivot point and previous highs of 0.71705, 0.72735 and 0.73707.

AUD/USD CHART

Chart created in TradingView

 

Written by Daniel McCarthy, Strategist for DailyFX.com. 1st December 2021

Link to comment

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
  • General Statistics

    • Total Topics
      23,601
    • Total Posts
      96,964
    • Total Members
      44,172
    • Most Online
      7,522
      10/06/21 10:53

    Newest Member
    Sparky
    Joined 03/12/23 21:47
  • Posts

    • Stock market analysis and trading strategies: NASDAQ 100, Apple (AAPL), Tesla (TSLA), Amazon (AMZN), Nvidia (NVDA), Microsoft (MSFT), Meta Platforms (META), Netflix (NFLX), Alphabet (GOOGL)  Stock Market Summary: Wave (i) of v) of 1 of (5) of 1) as a general count for most stocks, however this will be the Elliott wave count for the SP500 and the Nasdaq 100. Some stocks will make new highs, and some won’t, but they will still have the same wave count and I will explain this in today’s video. That said there are stocks like Tesla that are different, however they will move the same on an intraday basis, just with different Elliott wave counts. Trading Strategies: Long trades triggered on AAPL and AMZN Video Chapters 00:00  NASDAQ 100 (NDX) 02:52 Apple (AAPL) 06:20 Amazon (AMZN) 08:10 NVIDIA (NVDA) 12:29 Meta Platforms (META) 14:52 Netflix (NFLX)  1620 Alphabet (GOOGL) (sorry missed Google) 16:38 Microsoft MSFT 18:17 Tesla (TSLA) 19:41 End Analyst Peter Mathers TradingLounge™ Australian Financial Services Licence - AFSL 317817 Source: tradinglounge.com  #stocks #investing #trading     
    • Thanks. A really interesting video and some interesting statistics and analysis. I haven't the time to go back and analyse whether a strong November increases the chance of there not being a Santa rally, although one of the slides highlights that the negative Santa Rally years were tied with poor November returns for the market such as 2000, 2008 etc which seems a contradiction.  Would I short and back against it happening? When it occurs in over 80% of years... absolutely not.  The Santa Rally – Christmas Growth in the Stock Market. (moneysandi.com)
    • Trade statistics of the 'Triangle 8th' system as of 12/03/2023 Gain: 102.00% Profit: 781.52 USD Funds: 1,400.18 USD Balance: 1,781.52 USD Beginning deposit: 1,000.00 USD Withdrawals: 0.00 USD Top-ups: 0.00 USD
×
×
  • Create New...
us