Amid growing concerns about the Delta Cove variance in the Asia-Pack region, Australia and Indonesia have been badly affected and despite the Aussie fall, the Aussie pair have been suspended since yesterday and downbeat Aussie retail sales report.

Preliminary estimates of Australian retail sales for June fell to -0.5% and -0.1% for previous readings, -1.8% MoM. The previous day, Australia’s Westpac lead index for June was down -0.07%, down -0.06% from MoM. Not only the latest data, but also the negatives for the Aussie economy, mainly due to the Delta covid variant, weigh AUD / USD prices.

Sydney, Australia’s largest city, has reported 40% of Covid cases in the past 24 hours, with Victoria’s daily case number rising from 22 from 13 seen on Tuesday. The two most populous states in the country are under renewed locking restrictions, thanks to the rapid spread of this variation. Amid global growth concerns and fears of further warming in inflation, demand for the US dollar is reviving in Asia, putting further downward pressure on the Aussie.

Moreover, ongoing US-Sino tensions are also deterring Aussie bulls. In recent headlines, the US Undersecretary of State said the United States would continue to engage with Chinese officials. It comes a day after the United States, Europe, Japan and others accused Monday of a “malicious cyber-activism method” linking Beijing to an attack on Microsoft Exchange email servers discovered in March. It is worth noting that optimism surrounding US President Joe Biden’s infrastructure spending bill and strong Q2 earnings season could be cited as the main catalyst for the recent alarming mood.

AUD/USD 4 Hour Chart:

Support: 0.7299 (S1), 0.7270 (S2), 0.7242 (S3).

Resistance: 0.7357 (R1), 0.7386 (R2), 0.7415 (R3).

Amidst this the Australia lockdown restrictions and Aussie downbeat retail sales report puts pressure on Aussie pair. We expect bearish trend for AUD/USD.