December 4, 2022

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AUD/USD extends fall to lowest levels since December last year

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AUD/USD drops by 0.4% to 0.7517 ahead of European trading

AUD/USD D1 18-06

The dollar continues to hold more solid post-FOMC and we are seeing further reverberations as both the aussie and kiwi are taking a bit of a knock at the moment.

AUD/USD is down from 0.7540 to 0.7517 now in a drop to its lowest levels since December last year, after breaking below its 200-day moving average (blue line).

From a technical perspective, the latest shove lower doesn’t bode too well for the pair as it is the first time that sellers have managed to push below both key daily moving averages since last May – when the pair was still recovering from the pandemic crash.

That indicates a significant loss of upside momentum as the dollar gains a new lease of life following the Fed meeting this week.

As things stand, there is some support seen closer to 0.7500 but if the market (watch for bonds especially) is convinced of this turning point by the Fed, then perhaps there is room to explore further downside with little in the way of a run towards 0.7200 and then 0.7000.

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