- AUD/USD takes the bids to refresh multi-day high.
- NAB Business Confidence drops below market forecast and prior in Q3.
- Market sentiment dwindles amid a sluggish session, US Treasury yields stay firmer.
- Evergrande’s failure to clinch asset sale deal, hawkish Fedspeak weigh on risk appetite of late.
AUD/USD stays bid at 0.7527, the highest level since July 07 during early Thursday. In doing so, the Aussie pair ignores downbeat sentiment data from the National Australia Bank (NAB).
NAB Business Confidence not only lagged below the previous print of 17 but also dropped past market consensus of 5, with a -1 figure for the third quarter (Q3) of 2021. The drop in business sentiment could be linked to the coronavirus lockdowns in Australia.
Also challenging the AUD/USD bulls are the hawkish comments from Federal Reserve Governor Randal Quarles and Cleveland Fed President Loretta Mester. On the same line was the news that China’s struggling real-estate major Evergrande failed to seal the asset sale deal with Hopson Development Holdings. It’s worth mentioning that China’s two hypersonic weapon tests also should have weighed on the quote, but did not.
Additionally, a jump in Australia’s covid counts to the highest in a week, from 2,151 to 2,642 per ABC News, also probes the AUD/USD upside.
Even so, the US dollar weakness rules above everything else and keeps the Aussie pair on firmer footing. That said, the US Dollar Index (DXY) stays pressured around 93.60 near the lowest levels in three weeks by the press time, after printing a six-day south-run.
Against this backdrop, the US 10-year Treasury yields remain firm around 1.66%, up two basis points (bps) whereas the S&P 500 Futures print mild losses by the press time.
Moving on, AUD/USD traders will keep following the US dollar moves and the US data amid a light calendar at home. Hence, qualitative factors like Fedspeak and China news may gain major attention.
Technical analysis
A clear upside break of a four-month-old horizontal resistance, now support around 0.7480-75, enables AUD/USD bulls to battle multiple levels marked since April 01 near 0.7530-35. However, overbought RSI conditions and 200-DMA level of 0.7565 may challenge the run-up afterward.