Domestic Covid Concerns Weigh On AUD

AUD/USD has opened lower and is holding below the 0.76 handle in early Asia. Risk assets have taken a knock as markets digest news from the UK of the COVID-19 situation in the UK/Brexit dynamics. Headlines did cross the wires that negotiators in congress have reached a deal for a spending plan, though the announcement was tempered by conditions from both sides and the caveat that no deal will be signed until tomorrow evening. So far the news has had little effect.

• Covid concerns continue to weigh in Australia after a jump in cases in New South Wales. The state has imposed restrictions from Sunday night that limit gatherings in homes and limitations on travel.
• Limited data on the economic docket this week. Retail Sales are due tomorrow, with Private Sector Credit figures on Wednesday.
• AUD/USD last down 34 pips at 0.7588. The pair gapped lower from Friday's close of 0.7589.
• MNI technical analysis sees the pair still in a bullish trend despite the pullback. The Dec 2 break of 0.7414, Sep 1 high and former key resistance confirmed a resumption of the uptrend that began Mar 19. Moving average studies are also in a bull mode highlighting current sentiment. The focus is on 0.7677 next, Jun 6, 2018 high. Key near-term support is at 0.7507, Dec 15 low. The 20-day EMA intersects at 0.7450, also a firm area of support