AUD/USD drops to one-week lows, eyes 0.6800
- US Dollar rises across the board amid risk aversion, DXY hits weekly highs.
- AUD/USD extends correction from monthly highs, down for the third-day in-a-row.
A stronger US Dollar pushed AUD/USD further to the downside. The pair broke below 0.6825 and fell to 0.6813, reaching a fresh weekly lows. As of writing, it stands near the bottom, under pressure.
The Greenback gained momentum following a better-than-expected reading on the US Purchasing Managers' Index (PMI) that showed an improvement in economic activity. The Manufacturing PMI came in at 51.5 above the 50.7 of market consensus. The US Dollar Index broke above 97.55 and jumped to 97.75, the highest level since October 17. It is up 0.25%, testing the daily high. Among commodity currencies the Kiwi so far is the worst performer.
During the American session the demand for safe haven assets increased favoring the US Dollar, Gold and the Japanesse Yen. With no more US data to be released today, attention might turn now to Brexit headlines and US Vice-president Pence speech about China.
Form a technical perspective, AUD/USD remains bearish in the short-term and will likely continue unless it rises back above 0.6850, breaking a downtrend line. On the downside, the next support is seen around 0.6805. The 20-day moving average at 0.6798 is another critical level, a close below would point to further losses.
Technical levels to watch for