Fundamental Overview
The US Dollar has been gaining ground across the board this week despite the lack of economic data and lower Treasury yields, essentially moving forward by inertia.
Stanley Druckenmiller said in an interview yesterday that the market is already positioning for a Trump victory given the moves in some stocks like DJT for example.
That could explain the recent USD strength as it should appreciate on higher growth and less rate cuts expectations. Nevertheless, not all markets have been in sync with this view, so it could be just noise.
For now, we can only work with data and today we get the US retail sales and jobless claims figures which will likely be market moving. The key events though will be in November when we get the October data and the US election.
On the AUD side, the Australian labour market report today beat expectations across the board by a big margin. Although it didn’t change much in terms of interest rate expectations, it reinforces the RBA’s hawkish stance.
AUDUSD Technical Analysis – Daily Timeframe
On the daily chart, we can see that AUDUSD is getting closer to the 0.6622 level. If the price gets there, we can expect the buyers to step in with a defined risk below the level to position for a rally back into the 0.68 handle. The sellers, on the other hand, will want to see the price breaking lower to increase the bearish bets into the 0.64 handle next.
AUDUSD Technical Analysis – 4 hour Timeframe
On the 4 hour chart, we can see that the price is tentatively breaking above the downward trendline. The sellers will likely keep on defending the 0.67 handle but if the buyers manage to break higher, we might see a rally into the 0.6750 level next.
AUDUSD Technical Analysis – 1 hour Timeframe
On the 1 hour chart, we can see more clearly the recent price action with the spike higher on the strong Australian jobs report. There’s not much else we can add here as the buyers will look for a break above the 0.67 handle, while the sellers will likely lean on it to position for new lows. The red lines define the average daily range for today.
Upcoming Catalysts
Today we have the US Retail Sales and US Jobless Claims data.