AUDUSD trades at 0.70994, the Wednesday close in the current week's data. That is 22 pips below Monday's 0.71212 open, a slide of roughly 0.31 percent across three sessions. The high so far this week is 0.71399, printed Monday before the pair rolled over. The low is 0.70920, set on Tuesday. Every session so far has closed lower than the one before it.
No scheduled Australian or US release in this week's data has moved the pair. The pressure has come from China and commodities. The PBOC set its USD/CNY mid-point on Wednesday weaker on the yuan than the Reuters estimate had looked for, and the Aussie tends to wear that as a proxy. Oil settled lower on Tuesday as Saudi flows recovered and US and Iran talks went ahead, which took another prop away from the commodity currencies. Dollar firmness has been broad rather than Aussie specific, with USD/JPY holding its ground even after the BOJ hiked, so anyone watching EUR/USD for a cleaner read on the greenback is looking at the same story from a different angle.
The calendar in this week's data carries no high impact releases for Thursday or Friday, which puts the daily PBOC fix and the commodity tape back in charge. If Thursday's fix lands closer to consensus than Wednesday's did, the 0.70920 low becomes the obvious thing bidders defend, and a hold there keeps 0.71163, Wednesday's high, in reach. If the fix comes in weaker on the yuan again and crude stays offered, the path of least resistance stays lower and 0.70920 gets tested rather than defended. Wednesday's volume of 11,388 against Tuesday's 57,063 suggests the session is thin, so early Thursday flow can move price further than the news behind it warrants.
As of Wednesday, 53.6 percent of positioning is short AUDUSD and 46.4 percent is long. That is a modest short skew, not a crowded one. Consensus is leaning with the three day downtrend without committing to it, which means neither a squeeze higher nor a capitulation lower has much fuel behind it at current levels. A push through Tuesday's low would be the thing that turns that balance into something more lopsided.
0.71000 is the line price is fighting at. Wednesday's close of 0.70994 sits just underneath it, and Tuesday and Wednesday both spent time on either side. If buyers reclaim 0.71000 and hold it into Thursday, 0.71163 and then the Monday high at 0.71399 are the levels above. If 0.71000 caps the pair and 0.70920 gives way, there is no prior structure in this week's range beneath it, which is what makes that low the level to watch rather than the round number. Live pricing on the pair runs through the Sydney open for anyone holding an LHFX account.
Byline: LHFX Research
Risk disclaimer. CFD trading involves substantial risk and is not suitable for every investor. Leverage works both ways and can amplify losses beyond your initial deposit. The analysis above is general market commentary and does not constitute investment advice or a recommendation to buy or sell any instrument. LHFX is regulated by the FSC Mauritius and the FSCA in South Africa.
