- The dollar falls on Friday as stocks soar.
- Commodity prices also recover, US yields remain low.
- AUD/USD rises modestly on the week and remains above recent lows.
The AUD/USD it broke above 0.6920 and jumped to 0.6957 on Friday, reaching the highest level in two days. Stocks rise sharply on Wall Street helping the Aussie.
Risk appetite at the end of a positive week
Despite recession fears, investors rallied around stocks. US stock indices rise more than 2%, extending weekly gains. Negative economic data did not weigh on sentiment and kept US yields away from the recent peak, weakening the dollar.
AUD/USD rebounded from weekly lows below 0.6900, erasing weekly losses. Short-term prospects for the aussie improved. Above 0.6950 the next resistance is at 0.6990, the last defense at 0.7000. A decline below 0.6925 would expose the weekly low around 0.6870.
In the US, the focus will continue to be on how the Federal Reserve assesses the current outlook between high inflation and recession fears. In terms of data, Thursday’s PCE report (with underlying PCE numbers) will be the most important, followed by Friday’s ISM Manufacturing.
Australia’s economic calendar shows retail sales figures for May, due for release on Wednesday. “Although consumer sentiment has tumbled due to rising inflation and lower confidence around the economic outlook, household balance sheets are in good shape. In addition, a strong labor market should keep spending on households. A strong pace of retail sales will bolster the case for another aggressive move by the Reserve Bank of Australia in July, following its overblown 50 basis point hike,” analysts at TD Securities said.
|Last Price Today||0.6941|
|Today’s Daily Change||0.0041|
|Today’s Daily Change %||0.59|
|Today’s Daily Opening||0.69|
|20 Daily SMA||0.7074|
|50 Daily SMA||0.7099|
|100 Daily SMA||0.7214|
|200 Daily SMA||0.7234|
|Previous Daily High||0.6928|
|Previous Daily Minimum||0.6868|
|Previous Maximum Weekly||0.707|
|Previous Weekly Minimum||0.685|
|Monthly Prior Maximum||0.7267|
|Previous Monthly Minimum||0.6828|
|Daily Fibonacci 38.2%||0.6891|
|Daily Fibonacci 61.8%||0.6905|
|Daily Pivot Point S1||0.6869|
|Daily Pivot Point S2||0.6839|
|Daily Pivot Point S3||0.6809|
|Daily Pivot Point R1||0.6929|
|Daily Pivot Point R2||0.6959|
|Daily Pivot Point R3||0.6989|
Source: Fx Street