AUD/USD bulls take a breather around 0.6750 amid doubts over China Covid conditions – Crypto News – Crypto News
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AUD/USD flirts with monthly high, sits above 0.6900 amid subdued USD demand AUD/USD flirts with monthly high, sits above 0.6900 amid subdued USD demand

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AUD/USD bulls take a breather around 0.6750 amid doubts over China Covid conditions – Crypto News

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3 years ago

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  • AUD/USD struggles to defend recent gains, retreats from intraday highs of late.
  • Multiple countries announced special tests for visitors from China amid skepticism over COVID-19 conditions in Beijing.
  • Yields portray recession woes, geopolitical headlines add strength to market fears but holiday season restricts Aussie moves.

AUD/USD trades water around 0.6750 as it reassesses the optimism surrounding China’s unlock amid Thursday’s sluggish session. Also challenging the Aussie pair buyers during the second positive day are the fears emanating from Russia and upbeat US Treasury yields.

Although the dragon nation announced multiple measures to convince the markets of its ability to overcome the Covid-led economic woes, doubts over Beijing statistics and methods of unlocking seem to have challenged the previous optimism. News from Reuters suggesting inconsistent virus details from Beijing and multiple economies announcing fresh testing requirements from China previously weighed on the market sentiment and propelled the US Treasury yields. “China reported three new COVID-related deaths for Tuesday, up from one for Monday – numbers that are inconsistent with what funeral parlors are reporting, as well as with the experience of much less populous countries after they re-opened,” reported Reuters.

That said, the US, South Korea, Japan, Taiwan, Italy and India all of them have recently announced fresh Covid test requirements for visitors from China. Even so, Australia kept the previous policies requiring no extra tests for Chinese travelers.

It should be noted that Russia’s rejection of peace with Ukraine unless it accepts the treaty allowing additional territories joining Moscow weigh on the market sentiment and the AUD/USD prices. On the same line could be the news suggesting Russian forces increased mortar and artillery attacks on the city of Kherson more than six weeks after it was retaken by Ukrainian troops, while also exerting pressure along frontlines in the east, per Reuters.

However, the year-end holiday mood and a light calendar restrict the AUD/USD pair’s immediate moves. While portraying the market conditions, the S&P 500 futures saw around 3,810 whereas the US 10-year Treasury yield rounds to 3.87% after rising the most since October 19 the previous day.

To sum up, the AUD/USD strength appears doubtful amid multiple negatives to the sentiment and hence risk catalysts will be important to watch for fresh impulse. Additionally, US Initial Jobless Claims will decorate the economic calendar and should be eyed for additional directions.

technical analysis

Multiple Doji candlesticks in the last few days suggest indecision of the AUD/USD traders. As a result, sustained trading beyond the 21-DMA hurdle surrounding 0.6740 becomes necessary for the bulls to keep the reins.

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