- AUD / USD gained traction after falling below 0.7750 on Friday.
- The US dollar index records small daily gains, remains below 90.00.
- Investors await US Markit services PMI data.
After trading in a relatively tight range during the Asian session, the pair AUD/USD It fell to a daily low below 0.7740, but managed to regain its traction. At time of writing, the pair was up 0.06% on the day at 0.7780.
All eyes are on the US PMI.
After Thursday’s rally, AUD / USD made a technical correction, but risk appetite and uninspiring USD performance allowed the pair to reverse its direction.
At the moment, the yield on the US 10-year Treasury is losing 1% on the day and keeping the rise in the USD limited. Although the US Dollar Index is making small gains at 89.85, this appears to be the product of a sharp decline seen in the EUR / USD rather than a renewed and broad USD strength. Additionally, the major Wall Street indices appear to be opening into positive territory, suggesting that the dollar could struggle to outperform its risk-sensitive rivals.
Later in the session, IHS Markit will release preliminary May Manufacturing and Services PMI reports for the US.
Hours earlier, data from Australia showed that the Commonwealth Bank’s manufacturing PMI improved modestly to 59.9 in May from 59.7 in April and the services PMI fell to 58.2 from 58.8. However, the market reaction to these mixed readings was largely subdued.
Technical levels
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