AUD/USD drops further and ends week eyeing 0.7000
|- Greenback recovers strength on Friday, and rises particularity against commodity currencies amid risk aversion.
- Aussie post third weekly decline in-a-row against the US dollar and points to 0.7000.
The AUD/USD pair continued to slide during Friday’s American session. Near the end of the week bottomed at 0.7040, the lowest level since late October. It is trading at 0.7050, 130 pips below the level it had a week ago and less than 40 above YTD lows.
Thursday’s recovery was short-lived and on Friday AUD/USD resumed the decline. It broke clearly under 0.7100 and now is trading close to 2018 lows with a negative tone. The area around 0.7000 and 0.7050 is a key support area and a break lower could clear the way to more losses.
Dramatic reversal
At the beginning of the month, AUD/USD tested 0.7400 but quickly turned to the downside. Since then dropped steadily, unable to find support. Now it could test the critical support and a break below 0.7020 would put the price at the lowest since February 2016. So far, its the worst monthly performance since February.
The move to the downside took place amid a stronger US dollar on the back of risk aversion. Wall Street is at the lowest level in over a year after accelerating the downside during the current week amid increasing concerns about the global outlook.
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