After closing the previous two trading days in positive territory, the pair AUD/USD it reversed its course on Friday and was last seen trading at a fresh daily low of 0.7250, shedding 0.62% on the day.
Eyes on Wall Street, Powell
The bitter market mood ahead of the weekend appears to be weighing on the AUD / USD. Reflecting risk aversion, S&P futures and Nasdaq futures were down 0.48% and 0.62%, respectively. Meanwhile, the US Dollar Index (DXY) is rising 0.25% to 93.30 after Thursday’s 0.4% drop. Should US stocks take heavy losses after the opening bell, the DXY is likely to maintain its bullish momentum and force AUD / USD down in the second half of the day.
New home sales for August will be the only data on the US economic agenda Most importantly, FOMC Chairman Jerome Powell will deliver his opening remarks at the virtual event titled “Fed Listens: Insights on pandemic recovery. “
AUD / USD short-term outlook
Terence Wu, currency strategist at OCBC bank, believes that AUD / USD could target 0.7200 in the short term.
“AUD / USD will be a barometer of Evergrande’s risks in the short term,” Wu said. “Evergrande aside, the underlying risk bias is perhaps more sustained. I’d rather stay the course, looking for evidence to the downside of 0.7200.”
Technical levels
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