AUD/USD slumps to fresh yearly lows under 0.7150 eyes 0.7100

• Risk-off market sentiment weighs on the Australian dollar.
• Increase of global covid infections, dampen market sentiment.
• FOMC ongoing taper talks strengthen the US dollar.

The AUD/USD plunged on the day and reached a new low for the year at 0.7145. At the time of writing is0.71522 down 1.09 % in the session. 

The market is in a risk-off tone amid increasing global covid cases, and the unveiling of the FOMC last meeting minutes, which revealed taper talks conversations between Fed officials.

In Australia, the New South Wales Premier Gladys Berejiklian announced that the regional lockdown will be extended until August 28th, after recording a new daily high of 681 covid infections. In regards to the Fed minutes, few officials noted that a possible adjustment of slowing the pace of bond purchases, however, could not be soon. This gives us clues that bond tapering talks are occurring, however, the majority of the officials are in no rush, to start reducing purchases.

AUD/USD technical outlook

The AUD/USD trades at new lows for the year, at 0.7176. 

The AUD/USD is at 0.7173 and headed lower. The moving averages are above 0.7400 with the shorter time-frame under the longer time-frame and with a falling slope. The downtrend gain speed. The pair tested October 28, 20 high at 0.7157 and jumped above 0.0.7170. However, the fresh low of the year is 0.7143. On its way down, the next support is the 0.7157/50 range, followed by 0.7100 then November’s 2, 2020 low at 0.6996.

RSI is 29.45 in oversold levels, while the Average True Range is 57 pips and leaning upwards.