Plumbing Fresh Lows

General risk off sentiment amid a resurgence in coronavirus cases and worries over the delta variant kept AUD under pressure on Monday, AUD/USD dropped as low as 0.7322 before seeing a slight bounce. The pair last down 2 pips at 0.7342.

• From a technical perspective AUD/USD traded under pressure Monday. Having slipped lower Friday, the sell-off accelerated into the Monday close prompting new multi-month lows and a breach of support at 0.7410, Jul 9 low and the channel base at 0.7360. This opens a move toward 0.7304, the 1.236 projection of the Feb 25 - Apr 1 - May 10 price swing. Initial firm resistance is at 0.7503, Jul 13 high.
• Local COVID matters and recent press speculation around the potential for the RBA to renege on its tapering plans before the taper even begins both continue to weigh on AUD.
• The minutes from the RBA's July monetary policy gathering will be in focus today, although most see little scope for anything that would prove to be a gamechanger within the release, particularly as the COVID-19 situation has developed considerably since the meeting.