AUD/USD consolidates losses, heads for the lowest close since January 2017

• AUD/USD recovers but remains in negative territory weakened by risk aversion.
• US Dollar Index climbs to the highest in a year.

The AUD/USD pair bottomed today at 0.7279, the lowest since January of last year and then rebounded modestly. Recently rose to 0.7320 but the pair still remains under pressure.

The decline was triggered by risk aversion that followed a sharp slide of the Turkish Lira. The situation in Turkey raised concerns across financial markets, increasing the demand for the US dollar, the yen and the Swiss franc.

Earlier today, the Reserve Bank of Australia released the Monetary Policy Statement but offered no new information. The crisis in Turkey that hit European markets continues to be the main driver on Friday. US inflation data did not influence on greenback that remains on demand.

AUD/USD Technical levels

The pair today is about to break a 2-month trading range. A consolidation around current levels could point to more weakness ahead but if it managed to rise back above 0.7350, the negative tone would ease.

To the upside, resistance levels might be located at 0.7320 (US session high), 0.7345 and 0.7380. On the flip side, support could be seen at 0.7285, followed by 0.7245 and 0.7220.