AUD/USD bears lurking, looking to extend downside towards 0.7455?

Currently, AUD/USD is trading at 0.7567, up 0.03% on the day, having posted a daily high at 0.7573 and low at 0.7561.

• Forex today: well, it was all about forex 'for the rest of the week'

AUD/USD is falling out of favour with investors and quickly. The Aussie, as one of the higher betas, was otherwise a strong bid in 2017, rallying from just below the 0.72 handle until 0.7749 and 20th March high. However, as risk-off markets have ensued, some of the the high betas are struggling within an abundance of angst in markets. In two week's of trade, the Aussie is down 200 pips, and we are still counting. 

AUD/USD came under pressure again yesterday and overnight marking the fresh two-week lows despite a record trade surplus.  Lower iron ore prices aren’t helping, falling below $80 for the first time since January. Meanwhile, however, markets have been more concerned that the RBA may linger from here on judging by the outcome of yesterday's RBA announcements and statement. Analysts at Westpac figure that AUD’s next downside will be target 0.7500 (9 March low).

"The statement was seen as dovish, however, as the central bank noted a deteriorating labor market and expressed concern about a strong currency," explained analysts at Brown Brothers Harriman, adding, "governor Lowe also criticized the nation’s banks for having lax lending practices, adding that regulators are prepared to take more macro prudential measures to limit this.  In other words, the bank is in no hurry to hike rates.  This helped negate an earlier AUD bid on the back of better than expected February trade data."  

For the day ahead, China is still out and attention turns to the FOMC minutes. Analysts at Nomura offered an in-depth preview and markets will be looking for signs as to what the Fed will be doing about the balance sheet. Another major risk in the sessions ahead will stay with Trump. The prospect of Donald Trump meeting Xi Jinping could have significant consequences in the near term and longer term depending on how the meeting goes and what headlines the market will chase. 

AUD/USD levels

• AUD/USD: Minor resistance will again be seen at 0.7580

As analysts at Brown Brothers pointed out, AUD has been testing its 200-day MA near 0.7550.  "Break below sets up a test of the March low near 0.7490.  A break below 0.7455 and then 0.7385 is needed for a more bearish scenario to unfold." 

Valeria Bednarik, chief analyst at FXStreet explained the picture from a 4-hr perspective: "In the 4 hours chart, the 20 SMA turned sharply lower above the current level, crossing below the 200 EMA, whilst technical indicators have bounced modestly from oversold readings, rather reflecting the latest upward correction than suggesting further gains ahead. The immediate support comes at 0.7530, followed by the mentioned 0.7490."