Daily Currency Update

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Aussie find supports as pace of contagion slows

AUD - Australian Dollar

The Australian Dollar crept higher through trade on Tuesday, pushing back through 0.67 US cents as an injection of risk appetite help foster a shift off key technical supports. Market fears regarding the economic impact of the Coronavirus abated Tuesday as reports filter through suggesting a slowdown in the pace of contagion. The AUD touched overnight highs at 0.6737 before shifting marginally lower to open this morning buying 0.6712 US cents.

AUD direction remains contingent on headline news events and variable market sentiment. As long as the Coronavirus continues to proliferate, we expect the AUD to remain under pressure and test supports at 0.6680 on the heels of adverse news updates and downturns in risk demand. What supports at 0.6680/50and resistance on moves extending beyond 0.6720/30.

Key Movers

The US dollar edged lower through trade on Tuesday, edging off four-month highs as risk appetite improved and demand for haven assets abated. With volatility across FX markets largely non-existence the Greenback remains largely well bid and we expect the broader bullish narrative to continue, especially as investors look to short the Euro in a carry play to foster a higher yield return. The Euro fell through 1.09 touching 1.0870 before the shift in risk sentiment helped foster a small bounce into this morning’s open.

With safe haven assets underperforming overnight we expect broad based direction to continue fluctuating on headline new updates and events in relation to the coronavirus as turn to Fed Chari Jerome Powell as the primary macroeconomic driver.

Expected Ranges

AUD/USD: 0.6680 - 0.6740 ▲

AUD/EUR: 0.6080 - 0.6180 ▲

GBP/AUD: 1.9080 - 1.9480 ▼

AUD/NZD: 1.0380 - 1.0530 ▲

AUD/CAD: 0.8880 - 0.8980 ▲