AUD/USD bears await for downside to resume again from 61.8% golden ratio

• AUD/USD bears waiting to engage once again following a significant correction.
• All eyes will turn to the Aussie GDP data today.

AUD/USD is starting out the day down 0.2% from overnight trade following a strong bid in the US dollar. However, the pair has corrected which gives rise to the prospects of an opportunity for bears to move in at a discount. At the time of writing, the pair is trading at 0.7128 between 0.7062 and 0.7170. 

The high beat currencies were tracking the performance of equities that sold off on the day. US bond yields lifted as Powell indicated the Federal Reserve might consider accelerating the taper of bond purchases as inflation persists.  Consequently, US equities had plunged with the S&P500 down 1.9%. The Treasury curve flattened with the yield on the US 10-year Treasury down 6bps to 1.438%. 

The sell-off in risk occurred on Tuesday following warning comments from the chief executive of vaccine developer Moderna who told the Financial Times that existing vaccines may not be as effective against the omicron variant.

"A remark in the Financial Times made by the CEO of a major pharmaceutical company is generating renewed selling pressure: he believes that the current vaccines will be less effective against the new variant of the virus, meaning that new vaccines will need to be developed. This, and then making such modified vaccines available, will take months in his view. This is raising concerns about far-reaching mobility restrictions to combat the "Omicron" variant," Commerzbank analyst Carsten Fritsch explained.

Meanwhile, markets will now look to today's key event for the Aussie in the Gross Domestic Product data. 

• Australian GDP Preview: September quarter contraction only a ‘setback’?

AUD/USD technical analysis

AUD/USD bears will be looking to see if the price from here will start to deteriorate. If so, then there will be prospects of a downside continuation. The 61.8% Fibonacci retracement level is so far holding up as resistance. 

From a 15-min perspective, the 0.7110 area will be important for bears looking to engage in a possible downtrend. A break there will likely be the last major defence for the bear trend to continue: