AUD/USD remains below 0.7200, near December lows

AUD/USD opened the year with a modest decline. The pair fell during the Asian session to 0.7164, approaching December lows. Then bounced to the upside and traded most of the day in a small range between 0.7190 and 0.7170. 

Activity across financial markets remained quiet all Monday and particularly during the American session. Most crosses of the forex market moved in minor ranges, with limited price action. 

On Tuesday, will be released the AIG Manufacturing Index in Australia and then the Caixin Manufacturing PMI in China. UK markets and Wall Street will return to normal trading after remaining close on Monday. 

AUD/USD outlook 

“The pair is poised to extend its decline during the upcoming Asian session, although a surge in Asian share markets will limit technical chances”, said Valeria Bednarik, Chief Analyst at FXStreet.

According to her, the 4-hour chart shows the price below its 20 SMA, “but more relevant, below the 61.8% retracement of the early 2016 rally at 0.7210, while technical indicators head modestly lower within negative territory, supporting the case for a downward move, particularly on a break below 0.7145, May 2016 monthly low.”