Sharp Decline As Greenback Spikes

The greenback soared today as bonds sold off and yields spiked, AUD/USD dropped to 0.7859 from session highs of 0.8007, briefly above the 0.80 for the first time since January 2018.

• Oil prices also dropped which weighed on AUD. There is approximately $5bn of options rolling of at 0.79 which could influence price action today.
• The technical picture has shifted somewhat given the sizable move lower, if the reflationary theme were to persist AUD/USD's bullish posture would be confirmed, although a now overbought RSI measure suggests progress could slow from here. Thursday's move higher raises the risk of a major test on key double top resistance from 2017/2018 at 0.8136. Support is seen at 0.7718, the 20-Day EMA, and 0.7651 the February 8 low.
• Market looks ahead to private sector credit data at 0030GMT/1130AEDT.