A recovery of risk appetite sent the Aussie higher across the board today.
But can AUD/USD move past its intraweek high resistance zone?
Before moving on, ICYMI, yesterday’s watchlist looked for bullish attention for EUR/CHF ahead of ECB’s policy decision. Be sure to check out if it’s still a valid play!
And now for the headlines that rocked the markets in the last trading sessions:
Fresh Market Headlines & Economic Data:
Single-family housing starts up by 1.1%, building permits rebounded by 13.8% in February signaling that the housing market is probably stabilizing amidst higher mortgage rates
The U.S. labor market remains tight as the initial jobless claims dropped by 20K (the most since July) to 192K and reversed a spike from the previous week.Philadelphia Fed manufacturing index improved from -24.3 to -23.2 in March, but missed -15.6 estimates and marked its seventh consecutive negative reading.
ECB raised interest rates by 50bps as expected and is going “data-dependent” going forward.
ECB said it’s closely watching “current market tensions” and is “ready to respond as necessary to preserve price stability and financial stability in the euro area.”
U.S. Treasury Secretary Janet Yellen told lawmakers that the U.S. banking system is “sound” but warned that only uninsured deposits capable of creating systemic risks will be protected.
Regional bank First Republic Bank received a $30B lifeline from a group of large U.S. banks including Bank of America, JP Morgan, and Citi to help stabilize the depositor base.
Oil snaps declining streak as Saudi, Russia meeting calms markets
Price Action News
A lack of fresh catalysts kept the major currencies in tight ranges until about midway through the Asian session when risk-taking dominated the headlines.
The Swiss National Bank (SNB) giving Credit Suisse a lifeline and the U.S. financial institutions banding together to create a rescue package for First Republic Bank might have also helped sustain the bullish momentum for “risky” bets like AUD, NZD, CAD, GBP, and EUR.
AUD, in particular, steadily gained ground and revisited a lot of its intraweek highs against its major counterparts ahead of the European session open.
Upcoming Potential Catalysts on the Economic Calendar:
Eurozone’s final CPI release at 10:00 am GMT
U.S. industrial production at 1:15 pm GMT
U.S. preliminary UoM consumer sentiment report at 2:00 pm GMT
Use our new Currency Heat Map to quickly see a visual overview of the forex market’s price action! 🔥 🗺️
AUD/USD took full advantage of the risk-friendly vibe and was one of the biggest winners of today’s Asian session.
The pair started the day near its U.S. session highs before rising by just a bit more than 80 pips or its full daily ATR.But can AUD sustain its bullish momentum?
AUD/USD is now consolidating at .6710, which lines up with R2 of its Standard Pivot Points on the 15-minute time frame.
More importantly, .6710 is right around the pair’s unbroken resistance levels this week.
With only the U.S. preliminary UoM consumer sentiment report on the docket, you can bet that traders will continue to price in their global banking concerns (or relief).
Focus on the swift actions of authorities and other major banking institutions can bust AUD/USD from its current consolidation and take it to the .6740/.6750 levels near the Pivot Point’s R3.
But if we see profit-taking or risk aversion in the next couple of hours, then AUD/USD could dip back down to the .6680 or .6660 previous areas of interest.
What do you think?