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Holding Post-Powell Gains

AUD

The greenback weakened on Friday following a speech from FOMC Chief Powell at the Jackson Hole Economic Symposium, AUD/USD rose to its highest since August 17 and closed around the best levels of the session. The pair holding the majority of the gains, last down 2 pips at 0.7310.

  • Weekend news flow saw New South Wales record another record round of daily COVID cases (1,218), while the Premier of Victoria noted there will be an extension of the state's lockdown measures, with more details set to come this week.
  • From a technical perspective AUD/USD maintains last week's firm tone and has traded above the 20-day EMA. Recent gains are still considered corrective though. The breach of 0.7290 on Aug 17 confirmed an extension of the bearish price sequence of lower lows and lower highs, reinforcing the current downward cycle. Price has also cleared 0.7200 and this opens 0.7053 further out, a Fibonacci retracement. The next firm resistance is seen at 0.7389, Aug 11 high.
  • GDP partials continue to headline the local docket, with company profits and inventories due to hit on Monday.

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