AUD/USD reverses an early dip to over 1-month lows

• AUD/USD recovers around 20 pips from over one-month lows set earlier.
• A modest USD pullback was seen as a key factor lending some support.

The AUD/USD pair maintained its softer tone through the mid-European session on Tuesday, albeit has managed to recover a major part of the early slide to over one-month lows.

The pair extended its recent pullback and witnessed some follow-through selling for the fourth consecutive session on Tuesday. Bulls, however, showed some resilience below mid-0.6800s and the pair attracted some dip-buying interest amid a modest US dollar pullback.

AUD/USD bounces off lows on softer USD

The greenback failed to capitalize on its early uptick and was pressurised by an intraday downfall in the US Treasury bond yields. Concerns of the corona-virus outbreak in China led to a turnaround in the global risk sentiment and boosted demand for traditional safe-haven assets, including the US Treasuries.

Meanwhile, the anti-risk flow held investors from placing any aggressive bullish bets around perceived riskier currencies, like the aussie. This might turn out to be the only factor capping any further recovery for the major amid absent relevant market moving economic releases from the US.

Technical levels to watch