The AUDUSD is trading lower, retesting a key support area between 0.6628 and 0.66399. The 100-hour moving average , currently at 0.66386, is also in play. Earlier, the pair broke below the 200-hour moving average at 0.66554, which now serves as a crucial resistance level. Short-term sentiment is bearish, but a move above this level could disappoint traders expecting further declines. The pair is currently trading at 0.6640.
Yesterday, the pair reached lows of 0.66294 and 0.66329 in two separate instances. Buyers stepped in during these dips into the support area. However, as financial markets face turbulence, it remains to be seen if buyers will be as eager to support the pair today. The AUDUSD usually reacts negatively to risk-off sentiment.
Yields in the U.S. are falling sharply, with the 2-year note down 44 basis points at 3.779% and the 10-year yield down 19 basis points at 3.447%. Last week, the two year yield reach a high of 5.085% and the 10 year yield traded just above 4% before rotating to the downside.
European yields are also plummeting, with the German 10-year bund yield dropping 30 basis points to 2.152%. To put this in perspective, the German yield reached a high of 2.77% earlier this month.
The US stocks are working toward the open with the Dow down -570 points. The NASDAQ is down 134.54 points in the S&P is down 65.79 points. In Europe, the German DAX is down -3%. The France's CAC is down -3.6% and the UK's FTSE 100 is down -3.17%.
