- AUD / USD accelerates pullback from two-year highs.
- The dollar gain pace before falling in the bags.
AUD / USD closed the fifth consecutive week in positive territory last week, but started the current one in negative and erasing much of that gains. The price broke below 0.7400 and it fell to 0.7371, the lowest level since Wednesday. It bounced and is trading 0.7390, nearly 40 pips below Friday’s close.
The pullback comes after AUD / USD hit its highest level in two years at 0.7449 days ago. The acceleration occurred due to a strengthening of the dollar on all fronts and due to the fall in the stock markets.
In the US, the data to be published on Monday is consumer credit that is not expected to have an impact on the market. The focus will be on what Wall Street does, where the futures point to a negative opening with falls in the order of 0.35%, after several had a closing at record highs in anticipation of more fiscal stimulus. If the decline continues, AUD / USD could continue downhill.
From a technical point of view, AUD / USD remains dominant uptrend but has lost momentum significantly. A consolidation below 0.7370 would add further downward pressure, with next support at 0.7335. To the upside, 0.7420 has become a relevant short-term resistance. To enable more raises, the aussie has to break 0.7450.
Technical levels
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