AUD/USD managed to make a show back above parity during Thursday’s trade, the recovery boosted by the China rate cut as well as market positioning for a hint toward QE3 by the Fed’s Bernanke in hish NY morning testimony. However, no signal was given and risk positions were pared back, Aussie closing NY at session lows of $0.9993. Rate recovered to $0.9918 into early local trade as markets adjusted positions on expectation that Asian equities would gain on the China move. However, Tokyo viewed the move as a possible warning that China data, to be released at the weekend, could be weak with Asian equities sold sharply lower. Strong sales of AUD/USD and AUD/JPY provided the lead in the change to risk-off, triggered stops through $0.9875 took rate to lows of $0.9838. Rate managed to recover to $0.9878 ahead of the European open, finding some buoyancy above Y98.50. Gold was also seen a driver in the early move lower in Aussie, stops triggered below $1585 took price to $1559. $1.5555 seen critical. End of week paring of risk expected to leave Aussie soggy ahead of China data.
EasyForexNews Research Team