Current Price: 0.6486
- Aussie lack’s of strength amid domestic concerns while greenback receives support form yields.
- AUD/USD confirms bearish bias, potential bearish acceleration under 0.6450.
The news flow is all about the coronavirus: the spread of the virus and the policy response. Australia will soon announce fiscal stimulus, and on Wednesday, Reserve Bank of Australia Deputy Governor Debelle confirmed the central bank was considering QE style operations targeting a price level in bonds. Consumer sentiment dropped to the lowest in five years in Australia. In the US, CPI data was expectably ignored. Inflation is set to slow down in the months ahead, leaving room to more easing from the Federal Reserve. For the Aussie, global factors remain critical, and for the US dollar, US yields. AUD/USD Short-term technical outlookVolatility was relatively low in AUD crosses despite all the headlines. The daily range in AUD/USD was significantly below the previous days. The pair peaked at 0.6539 but showed no strength and pulled back to the 0.6500 zone where it looks comfortable, but not likely for much longer. The retreat from 0.6684 (March 9 high) was sharp and kept the pair below the 20-day moving average, leaving the bearish bias intact. With AUD/USD again unable to sustain a recovery, a test of 0.6450 looms. A break lower would open the doors for another leg lower to 0.6400. On the flip side, 0.6550 is the first resistance to consider. The upside, while capped by 0.6630, is likely to be limited and unsustainable.
Support levels: 0.6460 0.6400 0.6320
Resistance levels: 0.6540 0.6580 0.6625
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