• The Australian dollar extends losses to two-wek lows at 0.7230.
• Concerns about the Ukranian war are hurting the Aussie.
• AUD/USD likely to consolidae between 0.7200 and 0.7340 – UOB Group.

The Australian dollar has failed to regain footing and keeps pushing lower on Monday, extending the last two weeks’ negative trend. The pair attempted to bounce up from March lows at 0.7230 earlier today although it remains unable to extend beyond the 0.7250 area.

Geopolitical tensions are hurting the Aussie

The slightly brighter market sentiment has failed to lift the risk sensitive AUD, which has depreciated about 2.7% after peaking at 0.7440 last Monday.

Aussie’s demand remains weighed by concerns about the Eastern European conflict. The milder market optimism triggered by the talks between Russian and Ukrainian representatives, which have pushed European and most Asian markets into positive territory, has failed to alter AUD’s bearish trend so far.

In absence of key macroeconomic data today, all eyes will be on the release of the minutes of the Reserve Bank of Australia’s latest meeting, due on Tuesday, and the outcome of the US Federal Reserve’s monetary policy meeting, which are likely to set AUD/USD’s near-term path.

AUD/USD expected to consolidate above 0.7200 – UOB Group

From a slightly wider perspective, the FX Analysis team at UOB sees the pair bottoming near recent lows and capped below 0.7400 over the coming weks: “While 0.7250 is not breached, the build-up in momentum has more or less fizzled out. In other words, AUD is still likely in a consolidation phase and is expected to trade between 0.7200 and 0.7370.”

Technical levels to watch