AUD/USD drops to fresh multi-week lows, below 0.6800 mark

• Concerns over coronavirus continued to weigh on the risk sentiment.
• The anti-risk flows kept exerting some heavy pressure on the aussie.
• Stronger USD adds to the selling bias and contributed to the downfall.

The AUD/USD pair tumbled to near two-month lows in the last hour, with bears now looking to extend the downward trajectory further below the 0.6800 round-figure mark.

The pair added to its recent losses and opened with a bearish gap on the first day of a new trading week amid growing concerns over the rapid spread of China's coronavirus. The virus has infected more than 2,000 people in China and killed at least 80, triggering a fresh bout of the global risk-aversion trade.

Aussie weighed down by risk-off mood

The global flight to safety was evident from a sea of red across the Asian equity markets and reinforced by a slump in the US Treasury bond yields. This eventually benefitted the US dollar's perceived safe-haven status and exerted some heavy downward pressure on the China-proxy Australian dollar.

The greenback was further supported by Friday's data, which showed that the Services PMI rose to the highest level since last March. At 53.2 for January, the reading helped offset the disappointment from the US Manufacturing PMI and pushed the Composite PMI to a 10-month high level of 53.1.

It will now be interesting to see if the pair is able to find any support at lower levels or continues with the ongoing bearish trend amid absent relevant market moving economic releases from the US.

Technical levels to watch