Listen to the latest market mood for the AUDUSD pair.
Weak AUD, Strong USD
The AUD is weaker on the session for two reasons.
- Firstly, an increase in the number of COVID-19 cases is keeping risk-off sentiment in the market. Cases from Beijing in China and increasing numbers in the US fuel the market fears over a second wave of infections.
- Secondly, the Australian jobs numbers have come in worse than expected at -227.7K vs -78.8K expected. The unemployment rate ticked higher too up to 7.1%.
The USD has been firmer on safe-haven bids concerning the COVID-19 cases.
Therefore, expect AUDUSD sellers on pullbacks.
We expect this outlook to play out into the end of the US Session. Though the outlook remains valid as long as these conditions remain the same.
Main Trade Risks
- One risk is if there is some positive COVID-19 news that turns risk sentiment back to ‘on’ and that will cause AUD to rise.
- Another risk is if the ‘reflation trade’ comes back into play and that causes USD weakness.