Asian Open

AUD/USD and the ASX 200 have flourished this week thanks to renewed bets of Fed cuts, even though softer employment and wages data for Australia rekindled hopes of a lower RBA cash rate.

The US dollar suffered its worst day of the year and Fed fund futures now imply with near certainty that the Fed will cut by September. And that saw AUD/USD breakout in style and USD/JPY roll over, breaking below two handles on Wednesday.

The USD was weaker despite higher producer prices, as traders placed greater emphasis on last month's figures being revised lower. And that now sees a 51% chance of a September Fed cut, according to Fed Fund futures.

The US dollar has regained its footing heading into a Powell speech and US PPI report, whilst USD/JPY looks set to break resistance and head for 157.

The US dollar snapped its 3-day winning streak and formed a bearish outside day, helping gold reach our upside target. EUR/USD and AUD/USD are now eyeing a move towards key resistance levels.

The US dollar may have risen for a third day, yet bulls lack the conviction that bears displayed last week. And that suggests this bounce could be corrective.

The Australian dollar handed back all of its pre-RBA gains, which was trying to notch up a fifth consecutive bullish day on anticipation of a more hawkish RBA. Yet the statement was not overly hawkish and Governor Bullock said the RBA “believe rates are at the right level to get inflation back to target”. Inflation was revised higher to show inflation falling back to target at a slower pace and the RBA remain “vigilant” to upside risks.

Both gold and GBP/JPY are showing signs of stability around key support levels to suggest they could extend their bounce. But with AUD/USD rising for four days on anticipation of a hawkish RBA, whether AUD/USD can extend its rally beyond resistance is up for question.

The US dollar snapped a 6-day winning streak to allow AUD/USD to rebound from 64c in line with yesterday’s bias. And if AU employment figures perform today, it could extend its gains for a second day.

A risk-off tone ensued across global markets to send the US dollar higher, to the detriment of AUD/USD and the ASX 200.

USD/JPY is less than a day's trade from 155, a level an ex-FX diplomat warned could trigger an intervention if breached. WTI crude oil seems to have solid support above $84, to hint at a swing low.

Another day, another milestone for USD/JPY which closed above 152 for the first time in nearly 34 years on Thursday.

Bond yields and the US dollar surged after the latest US inflation report bought serious doubt over a June Fed cut, dragging global indices lower which sets the stage for the ASX 200 cash market to suffer today.

1-day implied volatility levels for USD/JPY, EUR/USD and NZD/USD have blown out ahead of today’s key events, which includes comments from BOJ’s governor, and RBNZ cash rate decision and the US inflation report.

Momentum is turning higher for AUD/USD during a month that tends to promote positive returns, and gold bulls continue to dominate price action as it reaches yet another record high.

The US dollar retraced for a third day, but with NFP stats favouring a 'beat' then we're on guard for a dollar bounce.

US dollar bears wasted no time to short the buck after a soft ISM services report, to mark its second worst day this year - in a month usually associated with losses.