The AUD/USD currency pair on Friday plunged to a new multi-month low of 0.6685 following the release of the latest round of US data. The currency pair has been on a bearish run since news of the coronavirus broke out two weeks ago. It continues to trade close to the oversold levels of the RSI indicator.

The currency pair now looks destined to stretch the losses to new multi-year lows amid increased fears of a global outbreak of coronavirus. Australia relies heavily on China for exports. The Asian economic superpower has been hit hard by the deadly virus, which is where it first broke out.

AUD/USD Fundamentals Overview

The AUD/USD currency pair is trading at the back of a busy week in both markets. On Tuesday, Australia’s Westpak Leading Index improved 0.05% up from -0.02% in the previous period. However, National Australia Bank’s Business Confidence Index edged lower to -2 down from 1.0. Australia Banks Business Conditions Index was in line at 3.0 with expectations, down from 4.0.

On Wednesday, RBA’s Trimmed Mean CPI for Q4 remained unchanged and in line with expectations at 0.4. Consumer Price Index beat the (YoY) expectation of 1.7% with 1.8%. It also outperformed the (MoM) estimate of 0.6% with 0.7%. 

In the US, non-defense capital goods orders ex-aircraft for December missed the expectation of 0.0% with 0.9%. Durable goods orders ex-transportation and ex-defense also came short of expectations. And on Thursday, core personal consumption expenditure and the quarterly GDP for Q4 disappointed while continuing claims outshone initial claims. On Friday, the Chicago Purchasing Managers’ Index missed with 42.9 versus 48.8.

AUD/USD Technical Analysis (the 60-min chart)

Technically, the AUD/USD currency pair appears to be trading under intense bearish pressure. The pair continues to trade in a sharply descending channel, which indicates a short-term bearish bias in the market sentiment.

Therefore, the bears will be targeting short-term profits at around 0.6671 or lower at 0.6654 going into next week. On the other hand, the bulls will hope for a major reversal in the pair by targeting profits at around 0.6705 or higher at 0.6722.

AUD/USD Technical Analysis (the Daily Chart)

In the daily chart, the AUD/USD currency pair appears to have recently made a bearish breakout off an ascending channel The pair has now returned to trade within the main descending channel. This shows that the bears are trying to retake long-term control of the pair. 

Therefore, the bears will target long-term profits at around 0.6623 or lower ay 0.6545. On the other hand, the bulls will look to pounce by targeting rebound profits at around 0.6750 or higher at 0.6820.