Forex Market: AUD/USD daily trading forecast

Yesterday’s trade saw AUD/USD within the range of 0.7239-0.7300. The pair closed at 0.7260, up 0.12% on a daily basis, following two consecutive trading days of losses. The daily low was a test of the low from Tuesday, while the latter has been lowest level since October 14th, when a low of 0.7195 was registered.

At 7:21 GMT today AUD/USD was losing 0.65% for the day to trade at 0.7213. The pair touched a daily low at 0.7211 at 7:19 GMT. It has been the new lowest level since October 14th.

No relevant macroeconomic releases, which may influence AUD/USD trading, are scheduled today.

Bond Yield Spread

The yield on Australia’s 2-year government bonds went as high as 1.848% on October 20th, or the highest level since October 15th (1.852%), after which it slid to 1.812% at the close to add 3.2 basis points (0.032 percentage point) compared to October 19th. It has been the second straight trading day of increase.

The yield on US 2-year government bonds climbed as high as 0.637% on October 20th, or the highest level since October 13th (0.637%), after which it fell to 0.633% at the close to gain 3.6 basis points (0.036 percentage point) compared to October 19th.

The spread between 2-year Australian and 2-year US bond yields, which reflects the flow of funds in a short term, shrank to 1.179% on October 20th from 1.183% during the prior day. The October 20th yield spread has been the lowest one since September 29th, when the difference was 1.176%.

Meanwhile, the yield on Australia’s 10-year government bonds soared as high as 2.702% on October 20th, or the highest level since October 13th (2.715%), after which it slid to 2.674% at the close to add 5.7 basis points (0.057 percentage point) compared to October 19th. It has been the second consecutive trading day of increase.

The yield on US 10-year government bonds climbed as high as 2.079% on October 20th, or the highest level since October 9th (2.138%), after which it slipped to 2.058% at the close to add 3.5 basis points (0.035 percentage point) compared to October 19th.

The spread between 10-year Australian and 10-year US bond yields expanded to 0.616% on October 20th from 0.594% during the prior day. The October 20th yield difference has been the largest one since October 15th, when the spread was 0.620%.

Daily and Weekly Pivot Levels

By employing the traditional calculation method, the daily pivot levels for AUD/USD are presented as follows:

Central Pivot Point – 0.7266
R1 – 0.7294
R2 – 0.7327
R3 – 0.7355

S1 – 0.7233
S2 – 0.7205
S3 – 0.7172

By using the traditional method of calculation again, the weekly pivot levels for AUD/USD are presented as follows:

Central Pivot Point – 0.7281
R1 – 0.7367
R2 – 0.7473
R3 – 0.7559

S1 – 0.7175
S2 – 0.7089
S3 – 0.6983