- AUD/USD hits resistance around 0.7300.
- Dollar index falls as risk-tone picks up.
- Australian trade tensions with China weigh on the pair.
AUD/USD trades in a consolidation mode below 0.7300 after failing to penetrate the resistance area during the Asian session.
The bullish mood in the counter is intact even after the minor pullback as the news of the coronavirus vaccine and the ASEAN RCEP deal lifted risk appetite.
Johnson & Johnson said that it would experiment the vaccine on 6000 UK volunteers in the phase three trial – each patient receiving two doses of the COVID-19 antidote.
The announcement coming on the heels of last week’s euphoria over Pfizer’s and Moderna’s vaccine trial success weighed on the US dollar’s safe-haven appeal. The dollar index fell to near 95.50 levels.
The ASEAN summit witnessed 15 Asia-Pacific economies signing a China-sponsored trade pact – encouraging multilateralism in the region. The development will help in reviving the economies amidst the pandemic setback and help to attract AUD buying.
The bulls got another boost from the 6.9 Percent rise in October Chinese industrial production – signalling a continuous recovery in Australia’s top trading ally.
Even then, the rise in recent trade tension between the two countries might weigh on the AUD/USD while attempting to recapture the 0.7300 level. The coronavirus progress is also a deterrent for the pair while moving up further.
Looking ahead today, traders will eye the RBA Governor Philip Lowe’s speech at 0840 GMT.
