AUD / USD plummets to 0.7560 region, its lowest since early April

• AUD / USD struggled to capitalize on the upbeat positive intraday move led by the Australian jobs report.
• The USD added to the strong post-FOMC gains and sparked further selling around the pair.
• Technical selling below 0.7600 further contributed to the steep intraday decline.

The pair AUD/USD it continued to lose ground during the early days of the American session and fell to the lowest level since early April, around the 0.7560 region in the last hour.

The pair witnessed a dramatic turnaround on Thursday and fell nearly 80 pips from intraday swing highs, around the 0.7645 region touched in reaction to the Australian jobs report. The sharp drop for the third day in a row was sponsored by strong buying interest in US dollars.

The Fed surprised markets with an aggressive turn, signaling that it could raise interest rates at a much faster pace than previously anticipated. The so-called dot plot pointed to two rises by the end of 2023 and triggered a massive rally in the USD, taking it to the highest level since April 13.

USD bulls did not appear to be affected by a modest pullback in US Treasury yields and largely ignored disappointing macroeconomic data from the US The number of Americans claiming unemployment benefits increased to 412,000, while the Philadelphia Fed manufacturing industry fell more than expected to 30.7 in June.

The negative factor, to some extent, was offset by a generally softer risk tone, as shown by a modest pullback in global equity markets. This was seen as another factor that benefited the dollar’s relative safe-haven status and pushed away the Aussie flows perceived as riskier.

Meanwhile, Thursday’s drop could also be attributed to some aggressive technical selling below 0.7600. The AUD / USD pair has now approached the very important support of the 200-day SMA, which if it breaks decisively should pave the way for a further short-term depreciation move.

Technical levels