The US Dollar has been gaining strength this week despite lower Treasury yields and limited economic data. Stanley Druckenmiller suggested that the market may be anticipating a Trump victory, which could explain the recent USD strength. However, not all markets are in agreement with this view, so it could just be temporary noise.
Today, the US retail sales and jobless claims figures will be released, which could significantly impact the market. Looking ahead, key events to watch out for are the October data and the US election in November. On the AUD side, the Australian labor market report exceeded expectations, reinforcing the RBA’s hawkish stance.
In terms of technical analysis, on the daily chart, AUDUSD is approaching the 0.6622 level. Buyers may step in at this level with a defined risk below to anticipate a rally towards the 0.68 handle. Sellers, on the other hand, will be looking for a break lower to target the 0.64 handle.
On the 4-hour chart, the price is breaking above a downward trendline. Sellers may defend the 0.67 handle, but a break higher could lead to a rally towards the 0.6750 level.
The 1-hour chart shows a spike higher on the strong Australian jobs report. Buyers will be eyeing a break above the 0.67 handle, while sellers may look to push the price lower. The upcoming catalysts to watch out for are the US Retail Sales and Jobless Claims data.
In conclusion, the USD strength may be temporary, and market participants are awaiting key data releases and events in the coming weeks. Traders should closely monitor technical levels and upcoming catalysts to make informed trading decisions.
