It was a bit of deja-vu for the AUD overnight as commodities, with oil, in particular, weighing on markets.

The AUD/USD has recently seen a strong bid as price rebounded after the initial route. But now it seems most ‘risk-on’ markets are feeling a bit of pressure as the economic toll of social standing measures and shutdown start to take a toll.

Clearly WTI has been in focus lately and that will have a flow-on effect in Australia, given that the economy is a large commodity-based economy. The reliance on oil is not as high as other countries such as say the UK or Canada, but it is there nevertheless. There are plenty of industries that will be hit hard by this.

So for the time being, being bearish on the AUD/USD and even the NZD/USD is probably a good trade.

Looking to the charts and the Aussie, in particular, is evenly poised at the moment and could really break down if this current support level breaks down.

As we saw yesterday, the bounce failed under 0.6400 so that was in my eyes, very bearish.

We are seeing price trade in the green today and that might be a chance to short into. If price tries and fails to make a new high, that is a great short opportunity.

At the same time, I think a break of support around the 0.6270-80 region is a good momentum opportunity as well.

If the lows get taken, 0.6200 is an obvious target, but the potential for a larger move down to 0.6000 is certainly still on the cards.

If 0.6400 breaks to the upside and holds that would be a big surprise given the price action and sentiment at the moment.