AUD/USD consolidates in a range below mid-0.6900s
- The risk-on environment continued lending some support to the perceived riskier aussie.
- Hopes of a V-shaped global economic recovery further weighed on the safe-haven USD.
- A sustained move beyond 0.675 level will support prospects for further appreciating move.
The AUD/USD pair lacked any firm directional bias and remained confined in a narrow trading band, just below mid-0.6900s through the Asian session.
Following the previous day's modest pullback from one-week tops, the pair managed to regain some positive traction and was being supported by the prevalent risk-on environment. Tuesday's upbeat PMI reports from the Eurozone and the UK revived hopes of a sharp V-shaped global economic recovery.
The latest optimism seemed enough to offset worries about a resurgent of new coronavirus cases globally and undermined demand for the safe-haven US dollar. This, in turn, benefitted the perceived riskier aussie and remained supportive of the mildly bid tone surrounding the AUD/USD pair.
Meanwhile, some follow-through pickup in the US Treasury bond yields helped limit any deeper losses for the USD and kept a lid on any runaway rally for the major. This makes it prudent to wait for a sustained move beyond the 0.6975 region before positioning for any further appreciating move.
In the absence of any major market-moving economic releases from the US, the broader risk sentiment might continue to play a key role in influencing the AUD/USD pair. This, along with the USD price dynamics might further contribute towards producing some meaningful trading opportunities.
Technical levels to watch