AUD/USD eases from tops, up little around 0.7720 region

The AUD/USD pair retreated around 25 pips from daily tops and has now dropped to the lower end of its intraday trading range, near the 0.7720-25 region.

The pair gained some positive traction at the start of a new trading week, albeit struggled to capitalize on the move and faltered just ahead mid-0.7700s. The disappointing release of the German IFO survey results added to growing market worries about the potential economic fallout from the ever-increasing coronavirus cases.

This comes on the back a delay in COVID-19 vaccine supplies and concerns over the discovery of new variants, which, in turn, dented investors' confidence. The cautious mood led to an intraday turnaround in the equity markets, which drove some haven flows towards the US dollar and exerted pressure on the perceived riskier aussie.

That said, expectations of $1.9 trillion fiscal stimulus plan to help revive the US economy, to a larger extent, helped offset the negative factors. This might hold the USD bulls from placing any aggressive bets and help limit the downside for the AUD/USD pair amid absent relevant market moving economic releases from the US.

Meanwhile, the market focus now shifts to this week's FOMC monetary policy decision on Wednesday. Apart from this, the Advance US Q4 GDP report will play a dominant role in influencing the near-term USD price dynamics. In the meantime, developments surrounding the coronavirus saga and the broader market risk sentiment might produce some short-term trading opportunities around the AUD/USD pair.

Technical levels to watch