Listen to the latest market mood for the AUDUSD.
Strong AUD, Weak USD
The outlook for the AUD today is strong after the Chinese Caixin services and composite PMI’s printed their largest expansion in a decade. Australia is closely tied to China’s economy, so this gives a boost to the AUD. Furthermore, the risk was helped as Asian equity markets traded higher across the board. The Dollar Index continued its way down overnight as the risk on tones leads to dollar selling. US President Trump is also reported to be backing away from invoking the insurrection act and is please with how protests were handled last night. Risk is on.
These risk-on tones favour USD sellers which weakens in this environment and AUD buyers which will strengthen in this environment. Therefore we expect AUDUSD buyers at pullbacks today.
We expect this outlook to play out over the next 10-12 hours.
Main Trade Risks:
- Any negative US-China trade disputes news could invalidate this outlook and weaken the AUD.
- Any further US-China trade action. If President Trump takes actions against China in their trade dispute then AUD can fall.
- Any serious worsening of the US riots could start to hinder the risk tone and result in AUDUSD weakness.