- AUD/USD breaks out from a three-day range.
- Pro-risk mood weighs on the USD.
- AUD/USD technicals support bullish momentum.
AUD/USD trades at the highest level since June 2018 during the Asian session today as the selling in the greenback continues unabated. The pair trades above mid-0.7600s.
The USD weakness stems from market participants’ aggressive risk-on posture expecting a strong global economic recovery in 2021. Such a pro-risk mood helps risk-sensitive currencies like the Australian dollar to gain new highs.
The investors didn’t budge much even after Senate Majority Leader Mitch McConnell’s block to the proposal to increase the stimulus paycheck to 2,000 US dollars from the current 600 USD. The Senate delay in approving the hike in the relief-check hasn’t dented investors’ hope for additional financial support.
The US Treasury Secretary Steve Mnuchin’s announcement that the direct stimulus payment to qualified American will start from Tuesday, kept the US dollar bears in the hunt. Moreover, the street expects more stimulus announcements from the incoming President Joe Biden.
AUD/USD has now broken above a three-day trading range to trade beyond recent highs around 0.7640. The low volume in the markets due to the year-end holiday mood also affects the pair’s technical picture.
Traders will also keep an eye on Goods Trade Balance, Chicago PMI and Pending Home Sales in the US economic docket apart from stimulus discussions and pandemic updates.
At the time of writing, one Australian dollar buys 0.7650 US dollars, up 0.64% as of 09:43 AM UTC.