AUD/USD drops to fresh weekly lows, below mid-0.6900s
|- AUD/USD extended this week’s pullback from multi-month tops.
- The risk-off mood seemed to weigh on the perceived riskier aussie.
- Friday’s US ISM PMI, FOMC minutes will be eyed for a fresh impetus.
The AUD/USD pair dropped to fresh weekly lows, below mid-0.6900s during the early European session on Friday.
The pair remained under some heavy selling pressure for the second consecutive session on the last day of the week and extended its retracement slide from over five-month tops set earlier this week.
A fresh wave of the global risk-aversion trade amid escalating geopolitical tensions in the Middle East was seen as one of the key factors weighing heavily on perceived riskier currencies – like the aussie.
Tensions in the Middle East intensified following reports that US airstrike on Baghdad airport killed Iranian Major-General Qassem Soleimani and Iraqi militia commander Abu Mahdi al-Muhandis.
The global flight to safety benefitted the US dollar's perceived safe-haven status against its Australian counterpart and led to some follow-through long-unwinding trade through the early European session.
Meanwhile, the latest leg of a sudden fall over the past hour or so could be attributed to some technical selling below 100-hour SMA, which now seems to have paved the way for a further intraday weakness.
Moving ahead, Friday's release of the US ISM Manufacturing PMI might influence the USD price dynamics and produce some short-term trading impetus later during the early North-American session.
The key focus, however, will remain on the latest FOMC monetary policy meeting minutes, which might play a key role in determining the next leg of a directional move for the major.
Technical levels to watch
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