- AUD / USD flirts with 0.7500, as bulls celebrate risk appetite in the markets.
- The US dollar remains firmer, limiting the pair’s upward attempts.
- All eyes are on consumer confidence data from the US CB and the Australian CPI.
The AUD/USD is moving higher during the European session on Tuesday, recovering the level of 0.7500, although the bulls appear to lack continuation amid a vastly firmer US dollar.
The pair has retraced from the three-day highs reached at 0.7518 during the Asian session, as the USD continues to cling to its recent advance amid renewed optimism over the US infrastructure spending bill.
However the risk appetite prevailing in the market it keeps the firm tone around the Australian dollar intact. Rising iron ore prices in China also remains one of the main catalysts behind the upbeat momentum of the Australian dollar.
Iron ore prices extend their rally from multi-week lows amid a weekly industry data set that showed a drop in iron ore shipments to China from Australia and Brazil due to the escalating energy crisis all over the world.
Besides, the correction in US Treasury yields from five-month highs it also benefits the AUD due to its greater appeal as a higher-yielding alternative asset.
Investors also celebrate the resumption of US-China talks, with US Treasury Secretary Janet Yellen and Chinese Vice Premier Liu He, after discussing macroeconomic and financial developments during their virtual call earlier in the day.
The focus is now on the US CB consumer confidence data to be released during the American session. Investors will also keep a close eye on sentiment on Wall Street for new business opportunities ahead of the third quarter Australian CPI report.
AUD / USD technical levels
With the bullish momentum persistent, the AUD / USD needs to break above the daily highs at 0.7518 to test the three-month highs at 0.7548. On the other hand, immediate support is seen at the prior week’s low of 0.7452. The next target for sellers is placed at the round level of 0.7400.
AUD / USD additional levels