- AUD/USD remained heavily offered for the second straight session on Monday.
- Concerns about coronavirus kept exerting pressure on the China-proxy aussie.
The AUD/USD pair continued losing ground through the mid-European session and dropped to near two-month lows, around the 0.6775-70 region in the last hour.
The pair extended its recent bearish trend and recorded some heavy losses on the first day of a new trading week. Concerns over the outbreak of the deadly coronavirus turned out to be one of the key factors weighing on the China-proxy Australian dollar.
Aussie weighed down by risk-off mood
Meanwhile, market worries that authorities might be struggling to contain the outbreak of the virus triggered a fresh wave of the global wave of risk-aversion trade, which exerted some additional pressure on perceived riskier currencies – like the aussie.
The bearish momentum seemed rather unaffected by a subdued US dollar price action. As investors looked past Friday's upbeat US Services PMI, the anti-risk flow-led slump in the US Treasury bond yields kept the USD bulls on the defensive.
Monday's steep decline to the lowest level since early January could further be attributed to some technical selling on a sustained break below a short-term ascending trend-line extending through early October and late November swing lows.
Hence, some follow-through weakness, towards testing November lows around the 0.6755 region, now looks a distinct possibility. However, oversold conditions on short-term charts might help limit deeper losses amid absent relevant market-moving economic releases.
Technical levels to watch
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
AUD/USD failed just ahead of the 200-day SMA
Finally, AUD/USD managed to break above the 0.6500 barrier on Wednesday, extending the weekly recovery, although its advance faltered just ahead of the 0.6530 region, where the key 200-day SMA sits.
EUR/USD met some decent resistance above 1.0700
EUR/USD remained unable to gather extra upside traction and surpass the 1.0700 hurdle in a convincing fashion on Wednesday, instead giving away part of the weekly gains against the backdrop of a decent bounce in the Dollar.
Gold keeps consolidating ahead of US first-tier figures
Gold finds it difficult to stage a rebound midweek following Monday's sharp decline but manages to hold above $2,300. The benchmark 10-year US Treasury bond yield stays in the green above 4.6% after US data, not allowing the pair to turn north.
Bitcoin price could be primed for correction as bearish activity grows near $66K area
Bitcoin (BTC) price managed to maintain a northbound trajectory after the April 20 halving, despite bold assertions by analysts that the event would be a “sell the news” situation. However, after four days of strength, the tables could be turning as a dark cloud now hovers above BTC price.
Bank of Japan's predicament: The BOJ is trapped
In this special edition of TradeGATEHub Live Trading, we're joined by guest speaker Tavi @TaviCosta, who shares his insights on the Bank of Japan's current predicament, stating, 'The BOJ is Trapped.'