AUD/USD: risk sensitive major hit on investor's concerns

AUD/USD bulls were feeling a lot of pain today with a sell-off from through 0.7550 that continued to 0.7442.

US dollar index rises to 1-week high

The US dollar has been rising steadily in an environment where investors are concerned that the BoJ and ECB could indeed ease further adding a bid to the DXY and even in a stronger looking Chinese climate, the Aussie and commodities are under pressure. Analysts at Westpac explained, "An increase in global volatility around the FOMC and BoJ meetings and perhaps also heightened uncertainty in the final stretch of the US presidential campaign point to underperfomance of risk-sensitive AUD. The euro in contrast is supported by the Eurozone’s growing current account surplus."

AUD/USD levels

Valeria Bednarik, chief analyst at FXStreet explained that technically, however, chances are of further slides as in the 1 hour chart, technical indicators maintain their strong bearish slopes within oversold readings, while the 20 SMA accelerated its decline far above the current level.

"In the 4 hours chart, the Momentum indicator resumed its decline after correcting oversold readings within bearish territory, the RSI indicator heads south around 26, while the 20 SMA has crossed sharply lower below the 200 EMA well above the current level, all aligned to support a downward continuation. The immediate support is now 0.7420, July 27th low, with a break below it opening doors for a steeper decline that can extend down to 0.7250."