The Aussie has been one of the weakest among major currencies recently, as it gained less during the latest period of USD weakness which lasted until yesterday, with the troubles surrounding the Credit Suisse bank. the sentiment turned negative and traders ran for safety, with the JPY gaining the most.

The CHF also benefited from all this, despite Credit Suisse’s current situation causing concerns. There are rumors circulating about the bank, and regulators have released a statement with hopes for a possible merger, but the situation is delicate. Credit Suisse’s shares dropped more than 30% at one point, but ended up the day 14% lower after the Swiss National Bank said it would provide liquidity.

Central banks are reconsidering the path of global interest rates, and today’s ECB meeting is in focus. The implied probability is now 67% for a 25 bps rate hike tomorrow, rather than the previously forecasted 50 bps. The path for eurozone rates is now lower than it was just a few days ago, and this is reflected in a drop in EUR/USD to as low as 1.0517.

Worries about global growth continue to increase, weakening some commodities and commodity dollars more than others. US crude broke through the multi-month support above $70 and then fell to $65.60s while USD/CAD ended the day 79 pips, which may reflect differentials that now place the Bank of Canada near the top of the expected curve. There are minimal questions about Canadian banks.

AUD/USD rallied around 150 pips higher as the SVB failed, which sent the USD lower on hopes of a less dovish FED next week. But, the 200 SMA (purple) held as resistance on the daily chart and the troubles with Credit Suisse sent risk assets lower yesterday. We predicted that the reversal would come in this pair which did and today’s employment report from Australia didn’t help the situation much, which is another bearish sign for this pair.

AUD/USD Live Chart