At the lows today earlier in the session, it looked like AUD/USD was poised for a firm break to the downside but now we're seeing a recheck of the technicals as dollar gains ease slightly. The pair is still down 0.4% to 0.6865 but is at least keeping just above the 38.2 Fib retracement level at 0.6855 for the time being.
For sellers, a firm daily close below that will be much needed to establish the next downside leg in the pair. They are still in the hunt amid the prevailing trading sentiment but there's still no breakthrough yet.
After Fed chair Powell reaffirmed the central bank's resolve in fighting inflation, there isn't much else for traders to work with to start the new week. The continuation of the Friday theme is the ongoing narrative and we might get just a bit more of that before markets start to reassess things again ahead of the US jobs report at the end of this week.
As such, the technicals will play a vital role in dictating the pace of any moves at the moment. For now, the dollar is in command but besides a clear momentum break in cable, there are still key technical levels in play for other pairs as seen above with AUD/USD as well.
