Australian dollar, AUD / USD, RBA minutes, Chinese PMI call points
- U.S. stocks will rise as markets prepare for U.S. non-farm payroll (NFP) report
- The RBA policy statement and the PMIs from China pose a threat to market sentiment
- AUD / USD damaged above the previous resistance level, the eyes are directed to the 0.78 handle
Friday’s Asia-Pacific outlook
The markets in Asia-Pacific will open after a Wall Street session where most major indices rose, the Dow Jones Industrial Average (DJIA) took the pack higher to a new record level. Security code US dollar pulled back as investors ’optimism about equities rose. The day began with the optimal 498 thousand initial unemployment claims report for the week ended May 1, submitted by the Ministry of Labor (DOL), the first since the start of the pandemic with 500 thousand notifications.
Federal Reserve Financial Stability Report (FSR) because May crossed the wires after the New York closing time. The May FSR highlighted the rise in risky asset prices, backed by optimistic economic data, fiscal stimulus and progress in vaccine distribution across the United States. Although the FSR report cast a generally positive light on the economy, it noted that businesses, as well as households, remain stressed and especially among the most vulnerable, such as minorities and low-income workers.
Elsewhere, the treasury market saw yields fall on the longer side of the curve, continuing the trend at the beginning of the week. The benchmark’s 30-year return fell below 2.25%, while the 10-year return fell slightly to 1.57%. The government bond market’s better-than-expected response to unemployment data is likely to reflect the distraction of investors awaiting the much-anticipated non-farm payroll report before Wall Street’s opening bell on Friday. Investors expect the April jobs report to cross the wires at + 978k, but some analysts predict even better, looking for numbers below 1 million.
At the Asia-Pacific session on Friday, the Australian Reserve Bank’s monetary policy statement will go between the wires, followed by PMI data from China in April. A little later that day, China will release its trade data for the same month, with a consensus expectation of $ 28.1 billion. China reported a trade balance of $ 13.8 billion last month, the DailyFX Economic Calendar reports.
Meanwhile, tensions between Australia and China continue to ease. On Thursday, The news went over the wires that China intends to suspend strategic economic talks between the two countries. AUD/USD fell initially but rose overnight, probably as a result of the strength of the US stock futures market. Nevertheless, China is Australia’s largest trading partner and tensions are likely to rise further, calling into question the strength of the Aussie Dollar.
AUD / USD technical analysis
The Australian dollar passed the former level of resistance above the US dollar overnight, with the next level of potential resistance being considered to be a psychological level of 0.78. Both 20-day and 100-day simple moving averages are higher after the price increase at the beginning of the week. Moreover, MACD and relative strength index (RSI) turn higher.
AUD / USD daily chart
The chart has been created TradingView
AUD / USD COMMERCIAL ASSETS
– Written by DailyFX.com analyst Thomas Westwater
To contact Thomas, use the comments section below or @FxWestwater Twitter