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Home ANALYSIS

AUDUSD moves higher as commodities/yields rise

A.R Chowdhury by A.R Chowdhury
March 21, 2022
Reading Time: 4 mins read
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AUDUSD moves higher as commodities/yields rise

The AUDUSD is moving higher as commodities move higher and so do benchmark yields.

The price of crude oil is continuing to step higher with the April contract up at $107.70. Gold is up around $6.50. Silver is up $0.17 on the day.

In the Australian debt market the benchmark 10 year yield has moved from 2.01% on March 1 to 2.55% currently. The yield at the end of year was at 1.67% (up 88 basis points). in contrast, the US 10 year yield is currently at 2.155% and up from 1.52% at the end of the year (up 66 basis points for the year).

The high yield in Australia last week reached 2.585% which was the highest since December 2018. The 10 year yield is now above the 50% of the move down from the 2013 high. That midpoint comes in at 2.499% (call it 2.50% – see chart below).

The move higher has helped to support the AUDUSD.

Australia

Australia 10 year yield

Looking at the hourly chart of the  AUDUSD 
AUD/USD

The AUD/USD is the currency pair encompassing the Australian dollar of the Commonwealth of Australia (symbol $, code AUD), and the dollar of the United States of America (symbol $, code USD). The pair’s rate indicates how many US dollars are needed in order to purchase one Australian dollar. For example, when the AUD/USD is trading at 0.7500, it means 1 Australian dollar is equivalent to 0.75 US dollars. The Australian dollar (AUD) is the world’s fifth most traded currency, whilst the US Dollar (USD) is the world’s most traded currency, resulting in a very liquid pair, with tight spreads, often staying within the 1 pip to 3 pip spread range on most forex brokers. AUD/USD Popular Among Various Types of TradersA lot of traders consider the AUD/USD to perhaps be the most consistent currency pair with respect to swing trading, as it has often moved in steadfast cycles.Having said that, every pair presents its own challenges for traders.The AUD/USD is very popular with swing traders, with the four-hour timeframe being, historically at least, more dependable than others. Historically the AUD/USD is influenced by interest rate differentials, commodity prices, government credit ratings, and overall sentiment and speculation.

The AUD/USD is the currency pair encompassing the Australian dollar of the Commonwealth of Australia (symbol $, code AUD), and the dollar of the United States of America (symbol $, code USD). The pair’s rate indicates how many US dollars are needed in order to purchase one Australian dollar. For example, when the AUD/USD is trading at 0.7500, it means 1 Australian dollar is equivalent to 0.75 US dollars. The Australian dollar (AUD) is the world’s fifth most traded currency, whilst the US Dollar (USD) is the world’s most traded currency, resulting in a very liquid pair, with tight spreads, often staying within the 1 pip to 3 pip spread range on most forex brokers. AUD/USD Popular Among Various Types of TradersA lot of traders consider the AUD/USD to perhaps be the most consistent currency pair with respect to swing trading, as it has often moved in steadfast cycles.Having said that, every pair presents its own challenges for traders.The AUD/USD is very popular with swing traders, with the four-hour timeframe being, historically at least, more dependable than others. Historically the AUD/USD is influenced by interest rate differentials, commodity prices, government credit ratings, and overall sentiment and speculation.
Read this Term
, the pair has moved above the high from Friday at 0.7417. The high price just reached 0.7424. The next target comes in against swing highs going back to March 7 at 0.74293, and above that 0.74405. Those highs were the highest level since October 5, 2021. Getting above those levels would open the door for further upside momentum.

What would hurt the bullish bias?

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The close support comes near 0.73925. That level was the swing high from Thursday’s trade. On Friday the Asian session high stalled near that level and the price traded above and below it during the London session. In the North American session the price move back above that level and stayed above that level. The low today also was able to hold support near the 0.73925 (see red circles).

Move below that level, and there is a swing area between 0.73675 and 0.73799 that if broken to the downside would also ruin the bullish bias (see yellow area and green numbered circles).

AUDUSD

AUDUSD moves toward March high
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A.R Chowdhury

A.R Chowdhury

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