AUD/USD nursing losses near 3-1/2 week lows

The AUD/USD pair now seems to have entered a bearish consolidation phase and was seen oscillating in a narrow range, just above 3-1/2 week lows. 

The pair extended its bearish slide from 20-month tops set on January 26th and traded with a negative bias for the seventh consecutive session. The bearish pressure aggravated after Friday's upbeat US monthly jobs report, which indicated a pickup in stubbornly low wage growth and triggered a sharp US Dollar short-covering move. 

Adding to this, a rout in global equity markets prompted investors to move out of perceived riskier assets/currencies and was eventually seen providing an additional boost to the greenback's safe-haven appeal against its Australian counterpart.

The Aussie bulls were further knocked down by today's disappointing domestic data, showing retail sales dropped 0.5% in December and trade balance recorded a deficit of A$1.36 billion in December as compared to a surplus expected. 

Even the latest RBA monetary policy statement, revealing no rush to lift interest rates, did little to lend any support and stall the pair's downfall to an intraday low level of 0.7835 level, the lowest since January 10th. 

In absence of any major market moving economic releases, the pair remains at the broader market risk sentiment and any further deterioration should pave the way for additional weakness in the near-term. 

Technical levels to watch

Immediate support is now pegged near the 0.7820-10 region, below which the downfall is likely to get extended towards the very important 200-day SMA support near the 0.7745 region.

On the upside, any meaningful recovery is likely to confront fresh supply near 0.7875 level and is closely followed by the 0.7900 handle, which if cleared might trigger a short-covering bounce back towards mid-0.7900s.