AUD/USD: Vulnerable to further downside around 0.7700 as greenback bulls get stronger


  • AUD/USD matches Friday’s closing at weekly open, stays depressed near one-month low.
  • US Senate passes President Joe Biden’s $1.9 trillion stimulus during weekend.
  • American employment data came in strong, China’s trade figures also impressive.
  • Light calendar keeps risk catalysts, bond moves on the driver’s seat.

AUD/USD begins the trading week near Friday’s close of 0.7695, around early-February low, during the initial Monday morning in Asia. In doing so, the pair traders await fresh clues to extend the previous week’s south-run as the US dollar strength got extra support from Friday’s employment figures and weekend news of the US coronavirus (COVID-19) stimulus while the latest trade data from China favors Aussie bulls.

US jobs, covid relief package propel greenback bulls…

As if Friday’s 1379K Nonfarm Payrolls from the US, versus nearly 200K expected, wasn’t enough for the US dollar bulls, the upward revision to the headline data and decline in Unemployment Rate to 6.2% offered extra strength to the US currency.

Also on the positive side, though yet to respond, is the passage of US President Biden’s $1.9 trillion stimulus by the Senate with 50-49 votes. The “American Rescue Plan Act” will now be discussed in the House and is likely to be voted on Tuesday.

While the US Treasury yields portrayed a bit of pullback during late Friday, the overall strength of the bond bears kept favoring the US dollar bulls. However, Wall Street’s strong gains and weekend data from China, suggesting a 60% rally in the headlines Trade Balance (USD terms), during January and February, seem to test AUD/USD sellers off-late.

Given the lack of major data/events up for release during Monday’s Asian session, AUD/USD traders should keep their eyes on the US Treasury yields, currently around a 13-month high.

In doing so, the pair traders shouldn’t miss out on the risk catalysts expected to favor the bond bears, like hopes of further fund inflow building reflation as well as covid and vaccine updates.

Technical analysis

A decisive downside break of 50-day EMA and an ascending trend line from November, respectively around 0.7705 and 0.7775, keep AUD/USD sellers towards an 11-week-old support line, at 0.7641 now.

Additional important levels

Overview
Today last price 0.7695
Today Daily Change 2 pips
Today Daily Change % 0.03%
Today daily open 0.7693
 
Trends
Daily SMA20 0.7788
Daily SMA50 0.7734
Daily SMA100 0.7532
Daily SMA200 0.7314
 
Levels
Previous Daily High 0.7732
Previous Daily Low 0.7622
Previous Weekly High 0.7838
Previous Weekly Low 0.7622
Previous Monthly High 0.8008
Previous Monthly Low 0.7562
Daily Fibonacci 38.2% 0.7664
Daily Fibonacci 61.8% 0.769
Daily Pivot Point S1 0.7632
Daily Pivot Point S2 0.7572
Daily Pivot Point S3 0.7522
Daily Pivot Point R1 0.7743
Daily Pivot Point R2 0.7793
Daily Pivot Point R3 0.7853

 

 

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