- AUD / USD is witnessing some continuation selling for the second day in a row on Thursday.
- Risk-off sentiment benefits the safe haven USD and weighs on the higher perceived risk AUD.
- Investors await the release of the US Q4 Advanced GDP report for further momentum.
The pair AUD/USD remains under pressure at the start of the European session on Thursday and falls below the level of 0.7600, reaching the lowest levels since last December 29. At the time of writing, the pair remains in the zone of daily lows around 0.7595.
The pair has extended the previous day’s losses and witnessed some selling for the second day in a row on Thursday. He Prevailing risk-off sentiment continues to drive some safe-haven money flows to the US dollar and it has been seen as a key factor weighing on the Australian dollar, with the highest perceived risk.
Investors have become wary amidst the concerns about the economic consequences of the imposition of new restrictions due to the coronavirus. In fact, the UK has announced new measures to restrict travel to / from Britain, while China has also tried to limit Lunar New Year travel to halt an increase in COVID-19 cases.
Further, the delay in coronavirus vaccines, along with doubts about the timing and size of a new US economic stimulus package., have further clouded market sentiment. Since many positive news were already priced into the markets, the events have served as a catalyst for investors to withdraw profits.
Meanwhile, USD bulls seem unaffected by the current drop in US Treasury yields and also They seem to ignore the pessimistic statement from the FOMC on Wednesday. The Fed expressed concern about the pace of economic recovery and said the current public health crisis poses risks to the outlook.
The focus of market attention now shifts to the publication of the Advanced US Fourth Quarter GDP Report Thursday, which will be announced at the beginning of the American session. Apart from this, the market risk sentiment will influence the USD price dynamics and could generate some short term trading opportunities around the AUD / USD pair.
AUD / USD technical levels
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