AUD/USD struggles near 11-year lows, just below 0.6600 mark

The AUD/USD pair dropped to fresh 11-year lows in the last hour, with bears now looking to extend the downfall further below the 0.6600 round-figure mark.

The pair extended its recent bearish trajectory and continued losing ground on the last trading day of the week. A fresh wave of the global risk-aversion trade – amid persistent worries over the deadly coronavirus – was seen as one of the key factors driving flows away from perceived riskier currencies, including the Australian dollar.

Bears remain in control

Concerns over deepening economic fallout from the coronavirus outbreak resurfaced on Friday after the World Health Organization (WHO) officials warned the novel coronavirus could break out globally. This eventually fueled pessimism about the Chinese growth outlook and further undermined the China-proxy aussie.

On the other hand, the US dollar consolidated its recent strong gains to multi-year tops and remained well supported by the incoming stronger-than-expected US economic data. Meanwhile, the increased haven demand for the US Treasuries held the USD bulls on the defensive, albeit failed to lend any support to the pair.

The ongoing downward momentum also seemed rather unaffected by extremely oversold conditions, suggesting that the near-term bearish pressure might still be far from being over. Hence, some follow-through weakness, led by some fresh technical selling below the 0.6600 mark, now looks a distinct possibility.

Later during the early North-American session, the US economic docket – highlighting the release of flash Manufacturing PMI – might influence the USD price dynamics and produce some meaningful trading opportunities or provide some immediate respite to the bulls.

Technical levels to watch