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AUD/USD: Positive risk sentiment could see test of 0.7270/80 levels - Westpac

FXStreet (Delhi) - Sean Callow, Research Analyst at Wespac, notes that the AUD/USD pair has extended a five-day old rally from 0.7190 late Asia to 0.7235 and is consolidating around 0.7210 and the positive risk mood could see the Aussie test 0.7270/80 multi-session but overall we doubt AUD gains will be sustained until we see better news from China.

Key Quotes

“Outperformer NZD rose from 0.6550 to 0.6648 – a six-week high, then eased to 0.6610. AUD/NZD continued to slip, from 1.0900 to 1.0863 – a four-month low – before grinding back to 1.0900.”

“China’s markets reopen after a one week holiday. The Shanghai Composite will have plenty of catching up to do.”

“USD/majors is weaker and USD/CNH is more than a big figure lower, around 6.3475. This points to a lower USD/CNY fixing but it is hard to see the motivation for an aggressive move lower. A fixing around 6.3500 seems reasonable but will take a few days to see whether there is a change in the skew of fixings now that President Xi’s visit to the US is complete and the USD mood is less robust.”

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