Dollar firm at 2-decade highs as Aussie

Australian dollar

AUD/USD is trading down 0.06% at 0.6932

The Australian dollar and the Chinese yuan came under pressure from weak Chinese economic data on Monday, while the U.S. dollar consolidated gains near a 20-year peak.

Comments by ECB policymaker Francois Villeroy de Galhau that the euro’s weakness could threaten the European Central Bank’s efforts to steer inflation towards its target pulled the euro from lows but sentiment was downbeat.

China’s retail and factory activity fell sharply in April as extensive COVID-19 lockdowns confined workers and consumers to their homes. The offshore Chinese yuan held near a September 2020 low of 6.8380 yuan hit last week.

“Increasingly, the risk is that zero-COVID (policy in China) may stay in place even past the party conference in the third quarter and into the winter season,” Barclays (LON:BARC) strategists said in a note downgrading its forecasts for the euro and the yuan for the rest of 2022.

Moves were sharper in the Australian dollar, which fell 0.68%, which is most exposed to the Chinese economy. It trimmed losses but was down 0.5% in London trading.

The dollar index was at 104.57, having briefly crossed the 105 level on Friday, its highest since December 2002, after six successive weeks of gains. Weekly positioning data showed investors built their long dollar bets.

On technical fronts AUD/USD RSI stood at 41.74 and currently it is trading above 5 days MA & below 10 and 20 days MA. So, SELL position can be taken with following target and stoploss:

TRADE SIGNAL – : AUD/USD – SELL: 0.6929, TARGET: 0.6849, STOP LOSS : 0.6981

About Author

Related posts

copper

Copper set to end June with a 16-month low

The price of COMEX Copper futures is down 2.33% at 3.6925 per pound on mid-Thursday trades. Copper prices further declined on Thursday. This makes copper prices on track for the biggest quarterly percentage fall since March 2020. The potential of a recession occurring coupled with the decline in demand...

Read More
US Dollar Index

Euro trims declines against U.S. dollar after Spanish inflation surge

EURUSD is trading down 0.10% at 1.0511 The euro steadied on Wednesday after falling to a six-day low, reacting to the release of conflicting inflation data in Germany and Spain that created a difficult backdrop for European Central Bank policymaking. The European common single currency decline in early London...

Read More

Leave a Reply