AUD/USD holds steady near 0.6600 mark, bearish USD helped offset coronavirus-led selloff

• A fresh wave of the global risk-aversion trade exerted some pressure on the aussie.
• The downside remains limited amid a strong bearish sentiment surrounding the USD.
• Collapsing US bond yields continued weighing on the greenback ahead of NFP report.

The AUD/USD pair traded with a mild negative bias for the second consecutive session on Friday, albeit the downtick lacked any strong follow-through selling below the 0.6600 round-figure mark.

Mounting fears over the fallout from the coronavirus outbreak continued weighing heavily on the investors’ sentiment. This was evident from a fresh wave of the global risk-aversion trade, which eventually exerted some pressure on the perceived riskier currency – aussie.

Bearish USD helped limit the downside

The downside, however, remained cushioned, at least for the time being, amid the prevailing strong bearish sentiment surrounding the US dollar, which remained under some heavy selling pressure in the wake of a plunge in the US Treasury bond yields to record lows.

Against the backdrop of the global flight to safety, the US bond yields were further dragged down by firming market expectations that the Fed will again have to cut interest rates by another 50 bps for the second time this month, at its upcoming meeting on March 18.

It will now be interesting to see if bulls continue to show resilience or opt to unwind their bullish positions as the focus now shifts Friday’s key data risk, the release of the closely watched US monthly jobs report – popularly know as NFP – later during the early North-American session.

Technical levels to watch