- The Australian dollar remains at the forefront of the week, rising 0.68%.
- Despite a mixed mood in the market, the US dollar index does not weigh on the AUD.
- AUD/USD Technical Outlook: Range bound but close to a bullish breakout if it holds above 0.7200.
The Australian dollar remains firm in the North American session as tensions in Ukraine rise. At the time of writing this article, the AUD/USD trades at 0.7223. Market sentiment is bearish across equities, while within the currency complex, risk-sensitive currencies continue to rank high, to the detriment of their safe-haven peers.
Meanwhile, the US dollar index visited the 96.00 mark during the session, falling to 95.96, down 0.12%, while the 10-year US Treasury yield rose two basis points to 1,948%.
Tensions between Ukraine and Russia escalated when Russian President Putin asked the Upper House Parliament to deploy Russia’s armed forces abroad. At the same time, NATO chief Stoltenberg said that they would continue to provide strong political support to Ukraine and said that NATO has more than 100 aircraft on high alert.
In the US, Secretary of State Blinken said yesterday’s actions are the beginning of the latest Russian invasion of Ukraine. Blinken added that Russia poses a threat to the security of people around the world.
Turning to AUD/USD, the Australian economic docket featured ANZ Consumer Confidence falling 1.4%, despite the easing of restrictions in New South Wales. In the last week, inflation expectations rose one tenth, going from 5% to 5.1%. Meanwhile, the US economic docket revealed IHS Markit’s manufacturing, services and composite PMIs for February, all of which were better than expected. Later, the Conference Board reported that consumer confidence for February beat expectations and came in at 110.8 versus estimates of 110.0, but lagged behind January’s print of 113.8.
AUD/USD Price Forecast: Technical Outlook
AUD/USD has a neutral bias as it remains confined between the 50 and 100-day moving averages (DMAs), with the latter above the former. However, it did break above a three-month downtrend line in the short term, opening the door for more upside, but would need a daily close above it.
If the above occurs, the first resistance for the AUD/USD would be the 100 DMA at 0.7240. A break of the latter would expose the 30 Dec daily high at 0.7275, followed by 0.7300.
Additional technical levels
Source: Fx Street
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