- A modest USD pullback from multi-month highs helps AUD / USD gain traction on Wednesday.
- The optimistic US economic outlook should help limit the USD’s slide and limit the pair’s gains.
- The US economic calendar and President Biden’s spending plan could create some business opportunities.
The pair AUD/USD It has moved higher at the start of the European session on Wednesday, staying close to the daily highs around the 0.7615-20 region, although it has lacked continuation.
Having shown some resistance below the 0.7600 level, the pair has managed to capture some positive traction on Wednesday and for now it seems to have stopped the retracement fall of the previous day from a week high. The US dollar has witnessed some profit-taking and has moved away from multi-month highs. This, in turn, has been seen as a key factor that has offered some support to the AUD / USD pair, although any significant recovery still seems elusive.
Investors are still Optimistic about the outlook for the US economy amid the impressive pace of coronavirus vaccination and US President Joe Biden’s spending plan. In fact, Biden announced the opening of the US COVID-19 vaccine program for 90% of US adults by April 19 and will outline details about the first phase of its infrastructure spending plan of about $ 3-4 trillion later this Wednesday.
This, coupled with cautious sentiment in the stock markets, could continue to prop up the USD and limit the strong gains of the AUD / USD pair. Even from a technical perspective, the previous day’s dip below the 100 hourly simple moving average favors bears. Therefore, any subsequent positive movement could still be seen as a selling opportunity.
Market participants are now awaiting the US economic calendar, which includes the release of ADP’s private sector employment report, Chicago PMI and pending home sales data. Apart from this, the news about the US fiscal stimulus will influence the USD price dynamics and could generate some short-term trading opportunities around the AUD / USD pair.
AUD / USD technical levels
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