• Aussie no follow-through buying after 50-pips jump yesterday.
  • USD weak on yesterday data.
  • Holiday prevents aggressive positions.

Australia’s Private Capital Expenditure contracted by three Percent, disappointing the market expectations and capped gains in AUD/USD despite a 50 pips bounce yesterday.

The pair trades within a narrow range today consolidating near its highest level since early September, around mid-0.7300s.

The coronavirus vaccine roll-out hopes and emerging clarity in the US political picture, reduce the risk fears and thus cut the appeal of safe-haven US dollar. The greenback was also affected by the US macro data released yesterday and would support the AUD/USD in the days ahead.

The unexpected spike to 778K in the US unemployment claims for the week ended on November 20 triggered worries about economic recovery after being hit by the coronavirus-forced restrictions. Many states have introduced the new limits after the recent surge in the pandemic numbers.

The November 4-5 FOMC meeting’s minutes were released yesterday and it showed that the members had debated various options to support the economic recovery. Markets read the minutes details as confirming the current expectations of additional monetary easing during December, aiding the current bearish mood surrounding the USD.

The Thanksgiving holidays in the US might prevent investors from taking aggressive positions in the pair; hence, it would be wise to wait for further follow-through buying before joining the bull side to target levels beyond 0.7400.

At the time of writing, one Australian dollar buys 0.7362 US dollars, modestly up 0.02% as of 8:26 AM UTC.