- Data from the US shows that the economy grew at an annualized rate of 6.4% in the first quarter, beating expectations.
- DXY Rises Amid Rising US Yields; the 10-year yield reaches 1.68%.
The combination of a deterioration in market sentiment and rising US yields weakened the pair. AUD/USD which fell to 0.7751, reaching a new daily low, extending the correction from the six-week high it previously reached at 0.7817.
The acceleration of the AUD / USD decline came amid a sharp decline in Treasuries. The 10-year yield is up 3% after a pullback; it rose to 1.68% and, as of this writing, stands at 1.66%.
Previously, economic data showed that the US economy grew at an annualized rate of 6.4% during the first quarter, exceeding expectations. On the negative front, initial jobless claims fell less than expected and pending home sales in March rose below market consensus. On Friday, Australia will release the Producer Price Index (Q1).
AUD / USD capped again by 0.7815
The short-term outlook deteriorated for the aussie in the last few hours after failing to break above 0.7815 / 20. The aforementioned area capped the upside again, as it did on Monday and last week. A firm break to the upside would clear the way for more gains, targeting the 0.7850 area.
On the other hand, a consolidation below 0.7760 should point to more losses going forward, with a potential test of the weekly low at 0.7720 / 25, protecting 0.7700.
Technical levels
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