AUD/USD: traders looking for a catlyst, sinking from recent highs in dollar strength

Currently, AUD/USD is trading at 0.7842, down -0.01% on the day, having posted a daily high at 0.7845 and low at 0.7840. AUD/USD suffered from the higher betas being capped by the resurgence of the greenback on Monday. 

Forex today: mixed Fed chat, dollar higher and equities/ rates up

The commodity bloc was lower as CRB slides for the second day. AUD retreated as the USD gained, falling from 0.7870 to 0.7827 after opening at 0.7835 after a sharp drop, lead by AUD/JPY. Noting recent domestic data to start the week, the Australian AIG Performance of Construction index fell to 52.8 in December, from 57.5 in the previous month, already weighing on the Aussie. 

The week ahead

Traders will now turn to Tuesday's, November Building Permits, expected to decrease by 1.3% in the month. Then, NAB's business conditions and confidence indexes along with Chinese inflation will be next in focus. However, the Aussie November retail sales will be a likely major catalyst for the pair ahead of US CPI. 

AUD/USD levels

Valeria Bednarik, chief analyst at FXStreet noted that in the 4 hours chart, the pair settled below its 20 SMA for the first time since December 21st, whilst technical indicators entered negative territory, but lack directional strength, consolidating right below their mid-lines, somehow suggesting that selling interest is limited.  "Additional declines will come on a break below the 0.7800 figure, while renewed upward momentum will result from a break of the mentioned October high," Valeria added.