FxWirePro: AUD/USD erased early gains, extends weakness for the 3rd straight session ahead of RBA

Chart - Courtesy Trading View 

AUD/USD has erased early gains and was trading 0.11% lower on the day at 0.6912 at around 13:10 GMT.

The pair is extending weakness for the 3rd consecutive session, is on track for further weakness.

Strong follow-through US Dollar buying after upbeat NFP data on Friday aids further gains in the pair.

Data released on Friday showed that the US economy added 517K jobs in January, beating consensus estimates by a big margin. 

The unemployment rate unexpectedly fell to edged down to 3.4%, or the lowest since May 1969. 

Average Hourly Earnings were up 0.3% MoM and 4.4% over the past 12 months, down from 0.4% in December and 4.9%, respectively. 

Markets expect the U.S. Federal Reserve to lift its benchmark rate above 5% to squeeze inflation after data showed the labour market remains strong.

US dollar index hit a 3-week high of 103.39 before trimming some gains to trade at 103.20 at the time of writing.

Focus now on the Reserve Bank of Australia (RBA) policy decision during the Asian session on Tuesday. 

The central bank is expected to hike interest rates by 25 bps for the fourth time in a row after stronger domestic CPI.

Support levels - 0.6862 (55-EMA), 0.6808 (converged 200-DMA and 110-EMA)

Resistance levels - 0.6979 (21-EMA), 0.7001 (20-DMA)

Summary: AUD/USD trades with a bearish technical bias. The pair is poised for further downside, but hawkish RBA could limit losses in the pair. Major support lies at 200-DMA at 0.6808, break below will plummet prices.