AUD/USD pares intraday gains amid risk-off impulse, still well bid around 0.7200

• AUD/USD regained positive traction on Monday, albeit struggled to capitalize on the move.
• Modest USD weakness was seen as a key factor that contributed to the intraday move up.
• Russia-Ukraine tensions dented the risk sentiment and capped the perceived riskier aussie.

The AUD/USD pair retreated a few pips from the daily high and was last seen trading around the 0.7200 round-figure mark, still up 0.40% for the day.

The pair attracted fresh buying on the first day of a new week, though a turnaround in the global risk sentiment kept a lid on any further gains for the perceived riskier aussie. The early optimism faded rather quickly after a Kremlin spokesperson said that there were no concrete plans yet for a Putin-Biden meeting.

Adding to this, UK Foreign Minister Liz Truss noted that a Russian invasion of Ukraine looks highly likely. Moreover, a spokesperson for Germany's foreign ministry noted that we are in an extremely dangerous situation and sanctions against Russia would be put in place after further infringements of Ukraine.

Meanwhile, Russian state-controlled media, citing Russian military officials, said that five people who tried to cross the Ukraine/Russian border were killed. The officials further added Ukrainian armed vehicles were also destroyed in Russia's Rostov region, fueling fears of an imminent Russian invasion of Ukraine.

This, in turn, tempered investors appetite for perceived riskier assets, which was evident from a fresh leg down in the global equity markets. The anti-risk flow extended some support to the safe-haven US dollar and turned out to be a key factor that held back bulls from placing aggressive bets around the AUD/USD pair.

There isn't any major market-moving economic data due for release from the US on Monday, leaving the AUD/USD pair at the mercy of the broader market risk sentiment. The focus, however, will be on the upcoming meeting between the US Secretary of State Antony Blinken and Russian Foreign Minister Sergei Lavrov planned for February 24.

Technical levels to watch