AUD/USD sheds over 30 pips on fears of second wave of coronavirus

• Renewed coronavirus scare weighs over the China-sensitive Aussie dollar. 
• Beijing coronavirus situation is extremely severe, an official warns. 
• The AUD bulls need equities to extend their two-week winning trend.

The growth-linked and China-sensitive Aussie dollar is facing descent selling pressure in Asia, possibly due to heightened fears over the second wave of coronavirus outbreak in Beijing. 

The AUD/USD pair fell from 0.6597 to 0.6856 early Wednesday and was last seen trading at 0.6875, representing marginal losses on the day. 

China's capital has reported 106 domestically transmitted COVID-19 cases since June 11 and a senior city official has warned that the situation is "extremely severe", according to WION. Beijing has reportedly become a no-go zone, where authorities have mounted massive containment measures including mass testing of 90,000 people. The US, too, has recently registered a surge in new virus cases, especially in Florida and Texas. 

As a result, risk currencies are feeling the pull of gravity against the US dollar, which has been treated as a safe haven by markets since the beginning of the global pandemic in late February/ 

In addition, the US dollar may be drawing bids due to the better-than-expected US retail sales data released on Monday. The official data showed American shoppers returned in May, pushing retail sales higher by a record 17.7%. 

The losses in AUD/USD, however, could be reversed during the day ahead if the global stock markets extend their two-day uptrend. At press time, the futures tied to the S&P 500 are suggesting otherwise with a 0.15% decline. 

Technical levels