The Australian Dollar is under pressure for the third session on Wednesday, following a wave of global risk aversion and a rise in US Treasury yields, strengthening its US counterpart.
Traders are still reacting to the Reserve Bank of Australia’s (RBA) decision on Tuesday to remain with plans to reduce bond purchases to A$4 billion per week and stretch that out to February as a response to coronavirus concerns.
The AUD/USD is trading at.7362 at 08:52 GMT, down 0.0026 or -0.35 percent.
While the RBA Board acknowledged that the economic recovery from the current Delta lockdowns would most certainly be slow. It also forecasts a very robust pick-up for the entire year of 2022.
Daily Swing Chart
According to the daily swing chart, the primary trend is upward. The resumption of the uptrend will be signaled by trade through. Seven thousand two hundred twenty-two shifts the primary direction downward.
The AUD/USD is trading on the bearish side of a long-term retracement zone spanning 7379 to 7499, indicating resistance. On September 3, the rally was halted by this zone at.7478. Nominal values vary from.7222 to.7478. The initial negative objective is the retracement zone at.7350 to.7320. Buyers were expecting to come in on a test of this area because the overall trend is up.
In the short term, the range is.7106 to.7478. Its retracement zone from.7292 to.7248 is the principal downside target and the last probable support before the main bottom at.7222.
A persistent advance above.7379 indicates the presence of buyers. If this move generates enough upward momentum, expect it to expand into a minor pivot at.7414. Taking it out might cause the AUD/USD to fall to.7478.
Euro Continues to Pull Back
During the trading session on Wednesday, the euro fell back to challenge the 1.18 level. That is a topic that has come up several times. The euro might go back to the 1.17 level, or perhaps lower. Remember that the European Central Bank will make a statement during the day on Thursday, so this is a pair that will most likely be quite volatile given enough time.
The yen remained unchanged at 110.24 per Dollar, while the Australian Dollar fell to $0.7368.
The Canadian Dollar was trading at C$1.2693 per US dollar, its lowest level since August 23.
On Wednesday, the Bank of Canada kept its key interest rate at a record low of 0.25 percent and maintained its current quantitative easing program.
The Chinese yuan was trading at 6.457 per Dollar ahead of China’s inflation figures later in the day.
On Wednesday, the real fell over 3% to 5.3214 per Dollar as President Jair Bolsonaro attacked the Supreme Court, pushing people to disregard its judgments.
The lira fell 1.4 percent to 8.468 per Dollar after Turkish Central Bank Governor Sahap Kavcioglu said on Wednesday that the current policy rate of 19 percent is tight enough to keep inflation under control. In other news, Bitcoin remained unstable after an 11% drop on Tuesday.