AUD/USD fails to move above the 200-hour moving average
The upside move in AUD/USD today reached a high of 0.7030, capped so far by the 200-hour MA (blue line) as sellers lean on the level to prevent the near-term bias from turning more bullish. There is a hint of positivity in risk to start the day but don't expect European equities to take the baton and lead from the front.
Markets will be tuned in to the US jobs report later and that will be the key determinant of risk sentiment as we close out the week. That said, I would not expect risk assets to rally too much given a potential for the tides to turn following the release of the US payrolls.
For AUD/USD, the pair is now hugging the 100-hour MA (red line) so near-term price action is very much neutral as buyers and sellers battle it out around the key hourly moving averages.
Looking at the bigger picture, the 0.7000 handle remains a key psychological handle and will be one that gets called into question again if risk turns sour later. Further support is then seen at 0.6974, 0.6935-40, 0.6895-00, and then the January 2016 low @ 0.6827.
However, even if risk suffers later on in the day, AUD/USD may not necessarily be hammered outright. Should risk turn because the US economic outlook is seen to grow even darker, the dollar will also be on the receiving end of a beating to end the week. Something to consider as we get closer towards the US payrolls later in the day.
