9th September 2020 - AUD/USD: Bears eye two week low near 0.7200 amid risk-off mood


Good Morning,

Market Headlines

Negative risk sentiment overnight with sharp falls in global equity markets and oil prices. Technology stocks pulled the NASDAQ down 4.1% whilst the S&P 500 dropped 2.4% (lowest point in over a month). Gold collapsed on dollar’s demand, bottoming at $1,906 an ounce then bounced sharply from the level to settle around 1,930. Crude oil prices, in the meantime, fell to fresh 3-month lows with WTI settling at $37 a barrel.

Currencies

AUD/USD: 0.7205 – 0.7297

EUR/USD: 1.1766 – 1.1821

GBP/USD: 1.2985 – 1.3150

USD/JPY: 105.87 – 106.38

USD/CAD: 1.3100 – 1.3232

NZD/USD: 0.6612 – 0.6695

AUD/JPY: 76.42 – 77.52

AUD/NZD: 1.0873 – 1.0918

AUD Thoughts

- AUD/USD remains on the back foot near the lowest since August 26.

- Sino-American tension, US stimulus deadlock and Brexit contribute majorly to risk aversion.

- Wall Street marked heavy losses led by Tesla (down 17%), crude and gold also trade downwards.

- Consumer Confidence and second-tier housing data decorate today’s calendar.

AUD/USD sellers catch a breather while taking rounds to 0.7210-20 trading range, currently around 0.7205, at the start of Wednesday’s Asian session. In doing so, the quote nears the lowest since late-August as challenges to the market’s risk-tone sentiment mount.

A clear break below the 10-week-old support line, at 0.7228 now, drags the AUD/USD prices towards 0.7135-34 support confluence including 50-day SMA and August 20 lows.

Event Risk Data Today

AU – September consumer confidence

AU – August home loans

CA – BOC rate decision

CN – August CPI

US – July JOLTS job openings

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