AUD/USD slumps to 0.7650 area on strong DXY rebound

AUD/USD is falling sharply in the second half of the day.
Wall Street's main indexes are posting large losses.
US Dollar Index rises toward 90.00 on risk aversion.

Eren Sengezer FXStreet

The AUD/USD pair started the new year on a firm footing and came within a couple of pips of the multi-year high it set at 0.7743 last week. However, the souring market forced the pair to decline sharply in the second half of the day. As of writing, AUD/USD was down 0.65% on the day at 0.7653.

DXY turns north as investors seek refuge

Ahead of the first risk event of 2021, the runoff election for two Senate seats in Georgia, investors seem to be moving to the sidelines. Additionally, the surging number of COVID-19 infections, especially in Europe, revive concerns over nationwide lockdowns hurting the global economic recovery.

Reflecting the negative shift in sentiment, Wall Street's three main indexes are down more than 2% after opening at fresh all-time highs. Meanwhile, the US Dollar Index is virtually unchanged on the day at 89.90 with the greenback finding demand as a safe-haven.

There won't be any macroeconomic data releases from Australia on Tuesday and the risk perception is likely to remain as the primary driver of financial markets. Later in the day, the ISM Manufacturing PMI report will be featured in the US economic docket.

Technical levels to watch for

AUD/USD

Overview
Today last price	0.7661
Today Daily Change	-0.0044
Today Daily Change %	-0.57
Today daily open	0.7705

Trends
Daily SMA20	0.757
Daily SMA50	0.7386
Daily SMA100	0.7292
Daily SMA200	0.7013

Levels
Previous Daily High	0.7736
Previous Daily Low	0.7673
Previous Weekly High	0.7743
Previous Weekly Low	0.7557
Previous Monthly High	0.7743
Previous Monthly Low	0.7338
Daily Fibonacci 38.2%	0.7697
Daily Fibonacci 61.8%	0.7712
Daily Pivot Point S1	0.7673
Daily Pivot Point S2	0.7642
Daily Pivot Point S3	0.761
Daily Pivot Point R1	0.7736
Daily Pivot Point R2	0.7768
Daily Pivot Point R3	0.7799

Author

Eren Sengezer

FXStreet

As an economist at heart, Eren Sengezer specializes in the assessment of the short-term and long-term impacts of macroeconomic data, central bank policies and political developments on financial assets.

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