- The dollar soars on fears in the financial markets.
- AUD / USD has lost more than 150 pips since Friday’s close.
He AUD / USD is having the worst day in months with a general rise in the dollar in the market due to the strong falls in the equity markets. The price had closed on Friday at 0.7620 and is trading in the 0.7500 area, after bottoming out at 0.7461, the lowest level since 10 December.
The sharp fall occurred in a context of risk aversion that is leading to crashes in the stock markets and in the price of gold and oil. The dollar is the one that is rising the most. Wall Street futures point to a negative opening for the main indices with a decline of around 1.70%. In Europe the falls exceed 3%.
The spread of a new strain of coronavirus in the UK towards other countries renewed fears due to the impact of the pandemic, also generating more confinements in England and the ban on travel from the United Kingdom in several countries. This overshadowed the weekend’s US deal for more fiscal stimulus.
The AUD / USD retracement found support at the 20-day moving average at 0.7460. The zone between 0.7450 and 0.7460 is the strong short-term support, which if broken would point to a bearish extension to 0.7400. To the upside, resistances are at 0.7525 and then 0.7580. The dominant trend is still bullish, but the decline that is taking place may lead to a deterioration in the positive outlook.
Technical levels
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