AUD/USD Video 05.03.21.
Australian Dollar Remains Under Pressure Against U.S. Dollar
AUD/USD is currently trying to get to the test of the support at 0.7665 while the U.S. dollar is gaining ground against a broad basket of currencies.
The U.S. Dollar Index has recently managed to settle above the resistance at 91.75 and is moving towards the next resistance level at 92. If the U.S. Dollar Index settles above the 92 level, it will head towards the next resistance at 92.25 which will be bearish for AUD/USD.
Rising oil failed to provide sufficient support to the Australian dollar and other commodity-related currencies as traders focused on rising U.S. Treasury yields which is bullish for the American currency.
Currently, the yield of 10-year Treasuries is trying to settle above 1.55% while the yield of 30-year Treasuries is testing the 2.30% level. Bond investors are worried about higher inflation in the U.S. which is expected to be boosted by the huge coronavirus aid package.
In addition, Fed Chair Jerome Powell has recently signaled that the Fed was not worried about inflation and did not propose any measures to deal with the recent rise of Treasury yields. Powell’s dovish comments put additional pressure on U.S. government bonds and provided more support to U.S. dollar.
AUD/USD managed to get below the support level at 0.7700 and is moving towards the next support level at 0.7665. If AUD/USD manages to settle below this level, it will head towards the next support at 0.7635.
A successful test of the support at 0.7635 will open the way to the test of the next support level which is located at 0.7600.
On the upside, AUD/USD needs to stay above 0.7665 to have a chance to gain upside momentum in the near term. The nearest resistance level for AUD/USD is located at 0.7700.
In case AUD/USD gets above this level, it will head towards the next resistance at the 50 EMA at 0.7725. A move above this level will push AUD/USD towards the resistance at 0.7760.
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