AUD/USD last seen at $0.7042, virtually......>

AUSSIE: AUD/USD last seen at $0.7042, virtually unchanged at typing.

- The rate's 33 pip fall registered on Friday was primarily driven by a

strengthening greenback, which benefited from investors paring their bets that

the Fed might cut interest rates by 50bps at the next meeting. Friday's Asia-Pac

hours saw NY Fed issue a statement downplaying earlier comments from its

President Williams, which were broadly read as dovish. Downside momentum

remained, accelerated by a softer than exp. U. of Mich. Sentiment (p) and a WSJ

piece, which poured cold water on the possibility of a 50bps cut from the Fed.

- Bears would be pleased if AUD/USD extended Friday's losses, breaking below the

100-DMA & 50% retracement of the YtD range, which intersect at $0.7018. Below

opens the psychological $0.7000 barrier, which coincides with the 21-DMA & Jul 2

high. Worth noting, however, that the underlying trend remains bullish & topside

attention is drawn to the 38.2% retracement of the YtD range at $0.7083. The

fact that this level capped gains on Friday adds to its importance.

- With no Australian data releases scheduled for today, focus turns to flash

PMIs from CBA and skilled vacancies data, both expected on Wednesday.