AUD/USD hit four-day highs above 0.6800 as US dollar retreats

• US Dollar drops across the board, moves off multi-year highs.
• US economic data mostly above expectations.
• AUD/USD up on Friday, still heads for the lowest weekly close since May 2020.

The AUD/USD is rising more than 50 pips on Friday as it moves off the multi-year low it hit on Thursday at 0.6697. Recently the pair hit the highest level since Monday at 0.6805.

Near the end of the week, AUD/USD is hovering around 0.6800, far from the recent low but still in negative for the week. The weekly close could be the lowest since May 2020; however, the sharp rebound from 0.6700 is a positive sign for the Aussie.

Dollar correct lower amid risk appetite

The greenback is pulling back across the board as stocks in the US post strong gains. The Dow Jones is up by 2.00% and S&P 500 by 1.75%. US yields are modestly lower, unaffected by US economic data. The DXY is falling 0.62% on Friday, the worst performance in a month.

Data released on Friday showed Retail Sales rose above expectation in June, the Empire Manufacturing index climbed unexpectedly to 11.1 and the Consumer Confidence report also surpassed market consensus. The odds of a 100 basis points rate hike from the Federal Reserve at the July meeting rose after the numbers; and were partially offset by Fedspeak, suggesting a 75bps hike seems more likely.

Technical levels