AUD/USD REMAINS DEPRESSED NEAR DAILY LOWS, AROUND MID-0.7200S

• AUD/USD snapped three days of the winning streak amid a goodish pickup in the USD demand.
• The underlying bullish tone might help limit any further losses for the perceived riskier aussie.
• Investors now look forward to the US macro data for some meaningful trading opportunities.

The AUD/USD pair maintained its offered tone through the first half of the European session and was last seen trading near daily lows, just above mid-0.7200s.

The pair witnessed some selling on Thursday and for now, seems to have snapped three consecutive days of the winning streak amid a goodish pickup in the US dollar demand. The recent strong move up in the US Treasury bond yields acted as a tailwind for the greenback, which, in turn, was seen as a key factor that exerted some pressure on the AUD/USD pair.

Investors seem convinced that the Fed might still begin tapering its massive asset purchases in 2021 amid the optimism the Delta variant of the coronavirus won’t derail the economic recovery. The US Food and Drug Administration (FDA) granted full approval to the Pfizer/BioNTech COVID-19 vaccine and raised hopes that inoculations in the US could accelerate.

Adding to this, the top US infectious disease expert, Dr Anthony Fauci, said that COVID-19 could be under control by early next year and further boosted investors’ confidence. That said, the underlying bullish sentiment in the financial markets might cap gains for the safe-haven USD and help limit any further losses for the perceived riskier aussie.

Traders might also be reluctant to place any aggressive bets, rather prefer to wait on the sidelines ahead of the Fed Chair Jerome Powell’s speech at the Jackson Hole Symposium. This warrants some caution before confirming that the recent bounce from the 0.7100 neighbourhood, or YTD lows, has run out of steam and placing aggressive bearish bets.

In the meantime, Thursday’s US economic docket, highlighting the releases of the Prelim Q2 GDP (second estimate) and the usual Weekly Jobless claims, might provide some impetus to the AUD/USD pair. Apart from this, the broader market risk sentiment will also be looked upon for some meaningful trading opportunities around the major.