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Higher In Early Trade

AUD

AUD stronger in early trade in Asia. AUD/USD last up 12 pips at 0.7856. The news about a cyberattack on a critical U.S. fuel pipeline have bled into commodity markets, likely lending some support to commodity-tied FX. There has been little in the way of local catalysts to move the rate early doors.

  • From a technical perspective AUD/USD cleared the April high convincingly on Friday, again setting the stage for further gains toward the 76.4% retracement of the February - April downtick. A break here would be bullish and point the needle toward the year's best levels printed in late February. To the downside, a move below 0.7691 would open losses toward 0.7635 and the 0.7586 key near-term support.
  • CBA are optimistic for the outlook: "AUD/USD can remain elevated this week because commodity prices show little sign of peaking. Iron ore prices surged to fresh cyclical highs last week because a lift in Australia‑China tensions sparked supply concerns. Nevertheless, as long as China's demand for Australia's iron ore remains intact, which we expect, AUD can continue to lift."
  • Markets await the NAB Business Conditions survey and retail sales data. Elsewhere, there is some focus the announcement from Australian Treasurer Frydenberg on a so-called jobs budget said to be delivered on Tuesday.

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