AUD/USD: Bears ignore Aussie holidays, cheer coronavirus news at fresh multi-week low near 0.6815
|- AUD/USD kick-starts the week on the negative side after a four-week losing streak.
- Risk-off moves are dominating amid the holiday in Australia, relief from Aussie data are likely forgotten.
- Qualitative catalysts will be the key amid a lack of economics.
AUD/USD drops to 0.6814, with an intra-day low of 0.6811, during the early Monday morning in Asia. The fears of China’s coronavirus outbreak are dominating the market’s risk sentiment off-late. The pair seems to forget the last week's upbeat Aussie data that reduced odds of the RBA’s rate cut. The anti-trade news from the US also adds to the market’s risk aversion on Australia’s holiday.
Coronavirus all around…
While Chinese officials confirm more than 2,000 cases and 56 deaths due to the fatal coronavirus, a nurse claiming 90,000 spreads the fears. The US also registered the fifth case while Sydney and Japan are also in the line of affected due to the deadly virus.
Chinese authorities have extended their New Year holidays till February 02, no deadline for schools, to better concentrate on taming the virus that recalls SARS and MER fears.
Read: Chinese Nurse: “Pay attention to what I'm saying... 90,000 infected” in emotional plea for help
Eyes have now turned to the World Health Organization (WHO) that last week refrained from terming the virus fears as a global threat.
Elsewhere, Bloomberg shares the news that the Trump administration extends it's Aluminium and Steel tariffs to some imported products. Further, the US embassy in Iraq keeps bearing the rockets despite the Iraqi government’s recent show of dislike towards such attacks on foreign troops at home.
That said, the market’s risk-tone heavies with the traders’ rush to the US dollar while also ignoring the risk-barometer Australian dollar.
Given the absence of Australian traders, the recent cut in odds of the RBA’s rate cut, due to Aussie employment data, might have lost its charm and the same is likely to last long. Further negative to the pair is an absence of major data that could keep the risk-off.
Technical Analysis
Given the pair’s sustained break of 100-day SMA and an ascending trend line since early-October 2019, bears are likely aiming for 0.6800 mark ahead of looking for November 2019 low near 0.6755. Meanwhile, the support-turned-resistance line and 100-day SMA, around 0.6830 and 0.6845 respectively, can keep prices under check for the short-term.
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