Remains Under Pressure

A quiet day on Monday with volumes thin as US markets observe Martin Luther King Jr. Day. AUD/USD remained under pressure as markets look ahead to an address from President-elect Biden's selection for Tsy Secretary, Janet Yellen, as she appears in front of the Senate Finance Committee in the wake of comments in the WSJ that the US would not pursue a soft dollar policy.

• The pair dropped as low as 0.7660, before regaining some composure to close the US session at 0.7681, the pair last up 1 pip at 0.7682.
• Data early in the Asia time zone has been largely ignored. Australia ANZ consumer confidence falls to 108.7 from 108.9 previously. The future financial conditions index stood out with a gain of 2.4% and remains well above the long-run average, though inflation expectations have pulled-back a touch from their recent high.
• Contacts notes that the DTCC report showed that all of the FX options transacted on Monday were AUD put strikes, the key strike to watch is 0.7700 for AUD 1.2bn.
• AUDUSD is still trading below the recent high of 0.7820, Jan 6 high. Although the uptrend remains intact, there is a risk the pair will retrace lower short-term in a move that would be considered a correction and this would allow an overbought condition to unwind. Markets showed below key support of 0.7666, briefly. A firm break would expose 0.7600 and below. On the upside, clearance of 0.7820 resumes the uptrend