The Australian Dollar (AUD) strengthened for the second consecutive day on Wednesday, buoyed by positive economic indicators. Judo Bank’s Australia Purchasing Managers Index (PMI) for June showed a slight improvement, contributing to the currency‘s upward momentum.
Additionally, Australia’s Retail Sales figures for May surpassed expectations, rising by 0.6% month-on-month (MoM) compared to the previous month’s 0.1% increase, signaling robust consumer spending.
Despite these gains, the AUD/USD pair faces resistance as the US Dollar (USD) halted its four-day decline, supported by a rebound in the yield on 2-year Treasury bonds, which currently stands at 4.75%.
Investors are awaiting further cues from upcoming US economic data releases including the ADP Employment Change, ISM Services PMI for June, and the Federal Open Market Committee (FOMC) Minutes, all scheduled for later on Wednesday.
Technical analysis shows the AUD/USD trading around 0.6670, forming a symmetrical triangle pattern on the daily chart. A breakout above the upper boundary near 0.6680 could indicate further upside towards psychological levels at 0.6700 and resistance at 0.6714, the highest level since January.
Conversely, downside support is expected near 0.6630, aligned with the lower boundary of the symmetrical triangle, followed by the 50-day Exponential Moving Average (EMA) at 0.6625.
The Australian Dollar remains influenced by economic developments in China and domestic economic indicators, making it susceptible to shifts in sentiment and market expectations.
For more updates on currency movements and economic news, stay tuned as developments unfold throughout the trading day.
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