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  • AUD/USD remains capped amid negative S&P 500 futures.
  • AUD bears cheer Victoria virus woes, as focus shifts to US ISM.
  • Stalled USD pullback, upbeat Chinese PMI lend support.

AUD/USD consolidates Friday’s sharp sell-off in 30-pips narrow range on Monday, with the bears continuing to guard 0.7150 while the downside remains cushioned near 0.7120 region.

The upside attempts in the aussie remain elusive mainly due to the growing Australian economic damage amid business closures and strict lockdown measures announced in Victoria, as the second-wave of the virus tightens its grip.  On Sunday, Victoria declared a state of disaster, with 429 new infections reported in the last 24 hours.

However, the US fiscal wrangling induced stalled US dollar recovery across its main competitors and upbeat Chinese Caixin Manufacturing PMI appear to keep the losses limited. China’s Caixin Manufacturing PMI for July arrived at 52.8 vs. 51.3 expected.

The latest leg down in the spot can be associated with the fresh selling seen in the US S&P 500 futures, as markets turn cautious amid fresh US-China headlines and ahead of the US ISM Manufacturing PMI data. China’s Commerce Ministry announced that it launches anti-dumping investigation on polyphenylene ether imports from the US from August 3.

The AUD bulls remain unnerved ahead of the Reserve Bank of Australia (RBA) monetary policy decision due on Tuesday, especially in light of the coronavirus resurgence.

AUD/USD technical levels

The immediate upside will likely face stiff hurdle 0.7150 (daily high). The next resistance is aligned at 0.7178 (daily classic R3). On the flip side, the immediate support is seen at 0.7100 (round figure), below which the 20-DMA at 0.7069 could be tested.

AUD/USD additional levels