Gold exceeded $2.000 per ounce. Stock futures rose on Wednesday as investors awaited further updates on stimulus talks.
AUD: going pre-crisis
Information is not investment advice
This week, the AUD has been one of the strongest currencies on the Forex market. Currently, it is at pre-crisis levels against the JPY and the USD. Trading this high, it is testing the long-term downtrends at 0.7000 for the AUD/USD and 76.00 for the AUD/JPY. The question is, even if it does break it, what are the odds that it keeps going upwards?
The main driver for the advance of the AUD is the good management of the virus in Australia, which had minimal direct impact compared to other countries. After that, there is a timing factor: tied to China, the Australian economy was the first one to start the recovery while the rest of the world is still shrugging off the dust of devastation. As the Chinese economy is strong and quick to get back to full capacity, the AUD has that as guaranteed support for the upside. However, such a scenario when the AUD is winning over the rest of the world will not stay long: once other economies, primarily the US, are back to capacity, the balance will get back to pre-crisis status quo where the AUD is a weak link. That means, several months ahead, possibly until the US election is finished, the AUD may enjoy the weakness of the USD. But in the long-term, closer to the very end of 2020, the USD will reassert itself as the Forex central pillar, and the fundamentals will be settled down. Then the AUD will again be under pressure.
New COVID-19 cases globally have been on the rise lately, although it is too early to call them second waves in most countries.
With the pandemic claiming about 1000 lives a day in the United States, many departments said they lack the money and the staff to identify people who have been exposed, according to a survey of a 121 local agencies.
US stocks are set to open lower Friday, with investors worry over rising tensions between the US and China, deadlock over the next virus relief bill and possible disappointments from the key monthly employment report.
The pair was falling down amid the waning US dollar. However, the situation changed this month.
Dollar continues to keep firmer on the day, all eyes on the US jobs report later.