#AUDUSD @ 0.65740 grinds higher after rising the most in seven weeks. (Pivot Orderbook analysis)

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• AUD/USD grinds higher after rising the most in seven weeks.
• Broad US Dollar weakness, upbeat market sentiment and firmer China data underpin Aussie pair’s latest advances.
• Australia
• Fair Work Commission’s (FWC) Annual Wage Review, US Nonfarm Payrolls (NFP) eyed for clear directions.

The pair currently trades last at 0.65740.

The previous day high was 0.654 while the previous day low was 0.6458. The daily 38.2% Fib levels comes at 0.6489, expected to provide support. Similarly, the daily 61.8% fib level is at 0.6509, expected to provide support.

AUD/USD buyers take a breather at the weekly top, making rounds to 0.6565-75 after rising the most in seven weeks the previous day. That said, the Aussie pair cheered the broad US Dollar weakness and upbeat catalysts from the biggest customer China the previous day to post a stellar run-up. However, the cautious mood ahead of top-tier data/events prods the risk-barometer pair during the early hours of Friday’s Asian session.

The US Dollar Index (DXY) dropped the most in a month to reverse from the highest levels since mid-March whereas the United States Treasury bond yields also refreshed the weekly lows as the market’s pricing of the Fed rate hike drops. Adding strength to the DXY could be mixed US data and receding hopes of a faster Fed rate hike, as well as firmer data from China and passage of the US debt ceiling agreement in the US House of Representatives.

On Thursday, US ADP Employment Change eased to 278K in May from 291K prior (revised) but crossed the 170K market forecasts. On the same line, the weekly Initial Jobless Claims rose past 230K prior to 232K, versus 235K expected. Further, US ISM Manufacturing PMI eased to 46.9 in May compared to 47.0 anticipated and 47.1 previous readings whereas S&P Global Manufacturing PMI softened to 48.4 from 48.5 prior. Additionally, the US Employment Cost Index eased while the consumer sentiment gauge improved but the details were unimpressive.

Following that, Federal Reserve Bank of St. Louis President James Bullard recently published an analysis wherein the Fed hawk accepts that the prospects for continued disinflation are good but not guaranteed, and continued vigilance is required.

Apart from the United States data and receding Fed bets, the passage of the agreement to avoid the US default also underpins the market’s optimism and favors the AUD/USD Price. On the same line could be the upbeat China data, due to the dragon nation’s business ties with Australia.

Further, the US Republican-controlled House of Representatives recently passed the debt-ceiling bill and favored the market’s optimism as the ruling Democrats dominate in the Senate and can easily avoid the default now. It’s worth noting that the upbeat China Caixin Manufacturing PMI adds strength to the AUD/USD’s upside momentum. It should be noted that China’s Caixin Manufacturing PMI rose beyond the 50.0 level for the first time in three months while suggesting an increase in activities. That said, the private manufacturing gauge rose to 50.9 versus 49.5 expected and prior.

Against this backdrop, Wall Street closed in the green while the yields were down and technology shares were up, which in turn allowed the AUD/USD to remain firmer ahead of the top-tier data/events.

Among them, Australia’s Fair Work Commission’s (FWC) Annual Wage Review and the monthly US employment clues, as well as the last round of the Fed talks ahead of the pre-Federal Open Market Committee (FOMC) blackout period for policymakers will be eyed closely for clear directions. Should the Aussie wages increase and the US jobs report offers no major positive surprise, the AUD/USD can stay on the front foot.

A daily closing beyond the three-week-old previous resistance line, now immediate support around 0.6525, directs the AUD/USD bulls towards the 21-DMA hurdle of around 0.6630.

Technical Levels: Supports and Resistances

AUDUSD currently trading at 0.6574 at the time of writing. Pair opened at 0.6503 and is trading with a change of 1.09% % .

The pair remains strongly bearish on the daily time frame. It trades below the 20 SMA @ 0.6639, 50 SMA 0.6667, 100 SMA @ 0.6762 and 200 SMA @ 0.6698.

The previous day high was 0.654 while the previous day low was 0.6458. The daily 38.2% Fib levels comes at 0.6489, expected to provide support. Similarly, the daily 61.8% fib level is at 0.6509, expected to provide support.

Note the levels of interest below:

• Pivot support is noted at 0.6461, 0.6419, 0.6379
• Pivot resistance is noted at 0.6542, 0.6582, 0.6624

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