AUD/USD suffers biggest single day drop since November 9

The AUD/USD fell from 0.7682 to 0.7556 on Thursday as the bid tone around the US dollar strengthened after the two-year Treasury yield jumped to its highest level since 2009.

The spot closed at 0.7568 and continues to trade there in the Asian session today.

Jobless claims drop to 44-year low

The number of Americans filing for unemployment benefits fell to near a 44-year low last week, pointing to further tightening of the labor market. We are already near full employment and that is fanning the discussion of a March rate hike.

Focus on Yellen

The US dollar could extend gains further if Fed chair Yellen moves the Mach rate hike needle to full certainty with her hawkish comments. 

Also on tap is the ISM non-manufacturing data and comments from Fed’s Evans and Powell.

AUD/USD Technical Levels

A break below the strong support zone of 0.7523-0.7518 (50-DMA &200-MA + 100-DMA + Dec 14 high) would open doors for 0.7458 (Jan 16 low) and 0.7417 (Dec 7 low). On the higher side, breach of resistance at 0.7609 (Jan 24 high) would expose 0.7628 (5-DMA) and 0.7658 (10-DMA).