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AUD/USD down 1% to 0.7115 as the pressure mounts on risk trades
The sentiment in the pair is very much similar to that of NZD/USD as outlined here earlier as sellers are eyeing a test of the August lows of 0.7106 now.
A break below that leaves very little in the way of a push back towards testing 0.7000 and that means there is scope for the downside pressure so far today to extend.
The market is getting rather overwhelmed by the new COVID-19 variant and the fears associated with that. It is hard to be fixated on anything else amid the Thanksgiving holiday break but lighter trading conditions may be exacerbating some of the moves.
I’d be wary of that as we look towards next week but it is tough to fight the technicals as well, especially if the above support level does crack for AUD/USD.
We’ll only get a better sense of how things will develop based on the information on the new COVID-19 variant but for now, it is hard to bet against the market mood ahead of the weekend and that leaves the aussie rather vulnerable.