The Aussie dollar spent the first few days of this week riding high in the foreign exchange markets.
In its pair against the US dollar, for example, it went up by 1.6% at one stage.
It also then demonstrated what is known as ‘follow-through’, a period of price movements that confirms and reinforces what came before.
This was welcome news for the currency as it reversed a period of what looked to most traders like a fortnight or so of vague movements.
However, by the time Wednesday and Thursday came around, it was spotted slightly down from this high at one stage – reaching $0.7151.
Where it will go next is expected to depend on a number of factors.
It may well pick up its previous uptrend.
The chances of this coming to fruition would perhaps be exacerbated if a more sympathetic attitude to risk emerges globally, and this could depend in part on the publication of various economic data releases.
In terms of the economic calendar, one such event is likely to be the news from the US on Thursday about the performance of the labour market there.
While these developments are not directly related to the Aussie dollar, any potential signs that the world’s largest economy – the US – is getting back on its feet often fuels the riskier currencies in the forex markets.
Initial jobless claims figures for the dates around 17th July are due out from there at 12:30pm GMT.
These are expected to show no change from their previous position of 1,300,000.
Figures for continuing jobless claims are also due out on Thursday in the same time slot, though these will cover the preceding week.
Here, the figures are expected to shift from 17,338,000 to 17,067,000.
Some Australia-specific economic calendar events could also begin to have an effect.
On Thursday evening, for example, a set of preliminary purchasing managers’ index (PMI) figures are expected to be released.
These are due out at 11pm GMT and will be split into services and manufacturing.
On the services side, the figure is expected to rise slightly from 53.1 to 53.2.
On the manufacturing side, meanwhile, the leap is forecast to be larger – this time from 51.2 to 53.6.
Both of these figures will cover the month of July.
Looking ahead to next week, the big event on the cards for the Aussie dollar is the consumer price index release.
This will cover Q2 2020 and is due to be released at 1:30am GMT.
This figure is expected to show a dip from 0.3% to 0.2% on a quarter-on-quarter basis.
On a year-on-year basis, meanwhile, the index is due to show a dip from 2.2% to 2%.
It will be accompanied by a trimmed mean CPI release from the Reserve Bank of Australia in the same time slot.
EUR/USD overbought? Pair uncertain after 1.1916 hit
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