The AUD/USD pair was closed at 0.70197 after placing a high of 0.70290 and a low of 0.69613. Overall the movement of AUD/USD pair remained bullish throughout the day. The currency pair AUD/USD rose for the 8th consecutive day on Monday amid the risk-on market sentiment. However, the gains remained limited due to the ongoing Australia-Sino tensions.
On Monday, Australia said that China was unresponsive to its weeks-long please to ease tensions between the two largest trading partners that escalated after Australia called for an inquiry into coronavirus's origin.
The tensions began when Australia insisted on the call for an independent investigation in the pandemic, which was not targeted at Beijing as the origin of the virus was the wildlife market in China as per reports.
In response to this, China accused Australia of playing pretty tricks and said that China would boycott Australian products if it perused the inquiry. Although both sides say that it was unrelated to the Australian call for an inquiry, China suspended beef imports from Australia and imposed massive tariffs on Australian barley.
According to the Australian Trade Minister, Simon Birmingham, China ignored Australia's pleas, and their request for discussion was so far met with very depressing negativity. China is the biggest export market in Australia, and their relationships have been strained after Australian accusations. On Friday, China advised people to avoid traveling to Australia and cited racial discrimination and violence against the Chinese connected with the pandemic.
The weak U.S. dollar due to weak demand for safe-haven assets after the risk-on market sentiment due to better than expected NFP job report on Friday. Weaker USD pushed the currency pair AUD/USD further on Monday in the absence of any macroeconomic data release.
Daily Technical Levels
Pivot Point: 0.7004
The AUD/USD took a sharp bearish turn to trade at 0.6912 level, having violated the upward channel. This suggests the odds of continuation of selling in the Aussie dollar pair as the pair may find immediate support around 0.6879 level. Continuation of a selling bias can lead Aussie further lower towards 0.6806 level, but before this, the pair needs to violate 0.6879 level. The RSI is showing a bearish crossover on the 2-hour timeframe. Thus, we should look for selling below 0.6925 level today. Good luck!