AUD/USD steadies near 0.7060 ahead of housing data

After losing more than 100 pips in the previous week, the AUD/USD pair started the new week under pressure and dropped to its lowest level since early  |  11/02/2019 21:47
  • Greenback continues to outperform its rivals.
  • Coming up: Home loans and business confidence data from Australia.

After losing more than 100 pips in the previous week, the AUD/USD pair started the new week under pressure and dropped to its lowest level since early January at 0.7056. With markets going into a consolidation phase in the late NA session, the pair steadied in the bottom half of its daily range and was last seen trading at 0.7063, losing 0.35% on a daily basis.

The greenback's market valuation on Monday became the primary driver of the pair's action. Boosted by a decisive rebound in the 10-year T-bond yield and the sell-off surrounding major European currencies, The US Dollar Index rose to its highest level of 2019 above 97 to reflect the broad-based USD strength and weighed on the pair. At the moment, the DXY is looking to close the day 0.45% higher at 97.05.

In the early trading hours of the Asian session on Tuesday, home loans from Australia, which is expected to decline by 2% on a monthly basis in December, will be looked upon for fresh impetus. Furthermore, the National Australia Bank will publish the Business Confidence and Business Conditions data for January.

Technical outlook by FXStreet Chief Analyst Valeria Bednarik

The pair is technically bearish according to intraday readings, as, in the 4 hours chart, an attempt to regain the upside was contained by selling interest around a firmly bearish 20 SMA, currently at 0.7090, while technical indicators flirted with their midlines before turning south, now at daily lows and with the RSI in oversold levels. The pair has its next support in the 0.7020/30 price zone, with a break below it resulting in a steeper decline toward 0.6940.

Support levels: 0.7025 0.6980 0.6940

Resistance levels: 0.7090 0.7125 0.7160  

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