The aussie is down by 0.35% against the dollar at the moment
And it is the weakest performing currency on the major bloc. There isn't much that I can point to for the weakness in the aussie today but cross-selling momentum against the kiwi is certainly one of them. Apart from that, 3-year Australian bond yields are trading lower by 1.5 bps and follows the drop we have seen in 10-year yields since last week.
In general, that usually weighs on AUD/USD as rate differentials between US and Australia continue to widen further in favour of the US but the last four days have seen the pair rise on the back of dollar weakness instead.
Despite the drop so far today, buyers remain in near-term control of the pair but the technical signals aren't really encouraging as the upside momentum starts to show signs of exhaustion. Looking at the 4-hourly chart:
Overnight price action runs into resistance from the 200-bar MA (blue line) @ 0.7375 and buyers failed to secure a candle close above it. That in turn has seen price falling back lower and now testing the 100-bar MA (red line) @ 0.7343. Move below that and we could start to see a start of a turnaround in momentum towards the hourly moving averages in the first chart.
The selling in the aussie today also sees AUD/NZD break below the 1.1000 level and that is a key psychological level that is taken out:
The lows in AUD/NZD bounced off bids at 1.0950 but if the downside momentum holds below 1.1000, then the aussie may be set for more weakness in the near-term.
