Daily Forex News and Watchlist: AUD/USD

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AUD/USD took a chill pill from its upswing today!

Are there enough bulls around a broken resistance area to extend the pair’s uptrend?

Before moving on, ICYMI, yesterday’s watchlist looked at EUR/GBP’s uptrend ahead of the U.K.’s labor market data release. Be sure to check out if it’s still a good play!

And now for the headlines that rocked the markets in the last trading sessions:

Fresh Market Headlines & Economic Data:

China’s sovereign fund bought ETFs in a fresh bid to boost stocks

Australia’s manufacturing PMI fell from 48.7 to 48.0 in October; Services PMI also weakened from 51.8 to 47.6 for the month

Japan’s au Jibun flash manufacturing PMI steadied at 48.5 in October (vs. 48.9 expected); “A sustained reduction in new orders led to production shrinking at the fastest rate in eight months.

BOJ’s core CPI ticked up from 3.3% to 3.4% y/y in September

Germany’s GfK consumer climate deteriorated from -26.7 to -28.1 in October; “With the third decline in a row, hopes of a recovery in consumer sentiment this year must finally be laid to rest

U.K.’s adjusted experimental unemployment rate remained at 4.2% in the three months to August; Jobless claimants swelled from -9.0K to 20.4K in September

France’s manufacturing PMI dipped from 44.2 to 42.6; Services PMI higher from 44.4 to 46.1 in October

Germany’s manufacturing PMI improved from 39.6 to 40.7; Services PMI dropped to contraction territory at 48.0 in October (from 50.3 in September)

Eurozone’s manufacturing PMI worsened from 43.4 to 43.0; Services PMI also deeper into contraction from 48.7 to 47.8 in October

U.K.’s manufacturing PMI improved from 44.3 to 45.2 in October; Services PMI dipped from 49.3 to 49.2

Price Action News

Overlay of AUD vs. Major Currencies

Overlay of AUD vs. Major Currencies Chart by TradingView

The Australian dollar is one of the biggest winners so far today as an anti-USD sentiment encouraged a bit of risk-taking in the markets.

It may have also helped the commodity-related currency that news of China’s sovereign wealth fund buying ETFs to boost stock prices went around during the Asian session.

AUD did see slight intraday pullbacks when Australia’s PMIs missed market estimates and then again before the European session started.

The Australian dollar is currently gaining the most pips against EUR and GBP and is clocking in the least gains against NZD and USD.

Upcoming Potential Catalysts on the Economic Calendar:

ECB President Lagarde to give a speech at 12:30 pm GMT
U.S. flash manufacturing and services PMIs at 1:45 pm GMT
U.S. Richmond manufacturing index at 2:00 pm GMT
Australia’s quarterly CPI reports at 12:30 am GMT (Oct 25)

Use our new Currency Heat Map to quickly see a visual overview of the forex market’s price action! 🔥 🗺️

AUD/USD 15-min Forex

AUD/USD 15-min Forex Chart by TradingView

As you can see, AUD/USD’s uptrend was set back earlier today after Australia’s manufacturing and services PMIs registered weaker in October compared to their September readings.

The pair is now trading closer to .6360, which is right around the R1 Pivot Point level in the 15-minute time frame. More importantly, it’s testing a trend line support that’s been valid since…yesterday.

Can AUD/USD extend its upswing?

Take note that U.S. 10-year bond yields have taken a tiny breather from their downswing. PMI misses from Australia, Japan, Eurozone, and the U.K. may also add up to build selling pressure for “risky” assets like AUD.

If we see more of the anti-USD, risk-friendly vibes that we saw yesterday, then AUD/USD may draw in enough buyers to bounce from R1 and retest its previous highs near .6380.

But if U.S. bond yields resume their uptrend, or if today’s market themes lead to USD-buying across the board, then AUD/USD breaking below its trend line support and revisiting areas like .6350 or .6330 may be in the cards.

Watch this setup closely, forex friends!

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