AUD/USD clings to modest gains near session tops, just below 0.7000 mark
- A positive tone around the equity markets assisted AUD/USD to catch some bids on Friday.
- Concerns about worsening US-China relations, rising COVID-19 cases might cap the upside.
- Investors now eye second-tier US economic data for some short-term trading opportunities.
The AUD/USD pair edged higher through the Asian session and was last seen trading near the top end of its daily trading range, just below the key 0.7000 psychological mark.
The pair managed to regain some positive traction on the last trading day of the week and recovered a part of the previous day's losses. A positive tone around the global equity markets undermined demand for the safe-haven US dollar and extended some support to the perceived riskier Australian dollar.
Hope of additional stimulus by governments around the world partly offset concerns about the ever-increasing coronavirus case and worsening US-China relations. This comes on the back of the latest optimism over a potential COVID-19 vaccine remained supportive of the prevalent risk-on mood.
It, however, remains to be seen if the AUD/USD pair is able to capitalize on the move or runs into some fresh supply at higher levels. Worries over a further escalation of tensions between the world's two largest economies might hold investors from placing any aggressive bullish bets.
It is worth reporting that the US is considering to ban travel to the United States by all members of the Chinese Communist Party. This makes it prudent to wait for some strong follow-through buying before positioning for any further near-term appreciating move for the AUD/USD pair.
Market participants now look forward to the US economic docket, featuring the release of housing market data and Prelim Michigan Consumer Sentiment Index. The data might influence the USD price dynamics and assist traders to grab some meaningful opportunities on the last day of the week.
Technical levels to watch