- AUD/USD seems to be tracking the S&P500 futures.
- AUD’s hourly chart remains bearish despite the minor bounce from session lows.
The Aussie dollar is trimming losses, possibly tracking the recovery in the US stock futures, but remains in the bearish territory under 0.6358.
The AUD/USD pair is trading near 0.6335 at press time, representing a 0.24% drop on the day, having hit a session low of 0.6326 during the early Asian trading hours.
The S&P 500 futures fell by over 2% early Monday as Goldman Sachs downplayed the historical OPEC+ oil output cut deal, calling it insufficient to rebalance the market, which is currently staring at unprecedented coronavirus-induced demand destruction. Further, the surge in the new coronavirus cases in China likely added to bearish pressures around the stock futures.
However, in index futures have regained some poise in the last hour or so and are currently reporting a 1% decline. That may have helped the Aussie dollar recover from the session low.
The pair, however, remains below 0.6358, meaning the lower high on the hourly chart is still intact. That coupled with the bearish divergence of the 14-hour relative strength index suggests scope for a deeper drop toward 0.63.
A break above the lower high of 0.6358 is needed to invalidate or weaken the immediate bearish case.