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Corrective Pullback Continues, But Still Above 50-day EMA

AUD
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AUD/USD sits just above Thursday lows from US trade, tracking near 0.6605 in early Friday dealings. The corrective pullback in the A$ continued through Thursday's US session. From highs above 0.6650 we fell just under 0.6600, leaving the currency weaker for the fourth straight session.

  • The A$ was the second worst performer in the G10 space for Thursday, losing 0.21%. USD sentiment turned post much stronger than expected PMI prints, led by the services side.
  • US yields finished higher across the benchmarks, led marginally by the front end, with the 2yr back to 4.935% (up +6.6bps). The firmer yield backdrop weighed on US equities. Large equity sell programs rolled through in what appears profit taking from earlier record highs. The SPX fell 0.74%.
  • Headline commodity indices fell, the Bloomberg aggregate down 1.21%, while the metals index fell 0.81%. Iron ore is back under $120/ton.
  • For AUD/USD, the latest pullback appears to be corrective, although we sit below the 20-day EMA (0.6610). The 50-day day is back at 0.6575. Recent highs rest a 0.6714 (May 16).
  • Note as well the following option expiry for NY cut later: $0.6600-05(A$836mln).
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AUD/USD sits just above Thursday lows from US trade, tracking near 0.6605 in early Friday dealings. The corrective pullback in the A$ continued through Thursday's US session. From highs above 0.6650 we fell just under 0.6600, leaving the currency weaker for the fourth straight session.

  • The A$ was the second worst performer in the G10 space for Thursday, losing 0.21%. USD sentiment turned post much stronger than expected PMI prints, led by the services side.
  • US yields finished higher across the benchmarks, led marginally by the front end, with the 2yr back to 4.935% (up +6.6bps). The firmer yield backdrop weighed on US equities. Large equity sell programs rolled through in what appears profit taking from earlier record highs. The SPX fell 0.74%.
  • Headline commodity indices fell, the Bloomberg aggregate down 1.21%, while the metals index fell 0.81%. Iron ore is back under $120/ton.
  • For AUD/USD, the latest pullback appears to be corrective, although we sit below the 20-day EMA (0.6610). The 50-day day is back at 0.6575. Recent highs rest a 0.6714 (May 16).
  • Note as well the following option expiry for NY cut later: $0.6600-05(A$836mln).