AUD/USD bulls meet strong resistance at 0.69 the figure

• AUD/USD is back under pressure following an extension of the bullish correction.

• Bears eye a move below 0.6880 for the day ahead.

AUD/USD started off the week better bid higher and is some 0.61% in late North America trade after giving back territory from the highs scored at the start of the shift near 0.69 the figure. The currency pair rallied from 0.6824 and remains in bullish territory due to the softness in the greenback that is enabling the commodity sector some airtime.

DXY recoiled further to its lowest level since late August and after trading at a new cycle high Wednesday near 110.786 as per the DXY index. It is down for the fourth straight day and trading near 108.30 at the time of writing, after falling from a high of 108.86 and printing a low of 107.81.

Risk sentiment remains strong as the week gets underway which is weighing on the US dollar. However, the mood has left some analysts scratching their heads. Those at Brown Brothers Harriman argued ''its hard to see a reason for buying risk assets when the ECB is adding to the global headwinds. With its 75 bp hike last week with more to come, this means global liquidity is being withdrawn even faster than before.''

The analysts noted that the Reserve Bank of Australia and the Bank of Canada also hiked big last week, while the Bank of England is expected to join the ranks of the jumbo movers this week. ''Global growth is undoubtedly slowing and it remains to be seen whether any of these banks can engineer a soft landing.''

Meanwhile, the Aussie calendar will be lit up this week by the employment report. ''After the huge disappointment last month, August jobs report may show some modest improvement as indicators of labour demand (e.g., job ads) remain strong'' analysts at TD Securities argued.

''However, we see downside risk if COVID-related disruptions on the labour market persist. A poor jobs report likely seals the outcome for a 25bps hike (TD: 25bps) in October after the Governor struck a dovish tone last week.''

AUD/USD technical analysis

As per the pre-market analysis at the start of the week, the Aussie has rallied from the 0.6820's:

In the prior analysis above, the 0.6820s was eyed as a potential support area from which AUD/USD bulls would be attracted in for a discount to take the price on for a deeper correction of the prior downtrend, as follows:

The doji followed by the bearish engulfing is compelling as a topping formation that exposes the 61.8% Fibo of the prior bullish impulse that meets the prior resistance structure.