- AUD / USD lost its bullish momentum after advancing above 0.7700.
- NAB’s business confidence in Australia improved in January.
- The US Dollar Index is declining for the third day in a row.
The pair AUD/USD it gained traction during Asian business hours on Tuesday and broke above 0.7700. However, after touching its highest level in two weeks at 0.7736, the pair lost its bullish momentum and was last seen posting modest daily gains at 0.7715.
USD struggles to find demand on Tuesday
Hours earlier, data released by the National Australia Bank showed that business sentiment in January improved to 10 from December 5 and beat the market expectation of 8. On a negative note, trading conditions were down to 7 from 14 in the same period.
Despite mixed data from Australia, widespread selling pressure surrounding the dollar allowed AUD / USD to rise. Pressed by a sharp drop in U.S. Treasury yields, the U.S. dollar index (DXY) is falling for the third day in a row on Tuesday, shedding 0.35% to 90.60.
Data from the US showed that the NFIB Business Optimism Index in January fell slightly to 95 from 95.9 in December. Later in the session, the JOLTS job vacancies report for December will be placed on the US economic agenda.
On Wednesday, the Westpac Consumer Confidence Index and Australia’s HIA new home sales data will be considered for further momentum. Until then, the USD market valuation is likely to continue to drive AUD / USD action.
Technical levels
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