Aussie dips below 0.77 line January 18, 2021SharePrint The Australian dollar has started the new trading week with slight losses. AUD/USD is currently trading at 0.7681, down 0.26% on the day. US dollar on the move The US dollar looked like the G-10 punching bag in the latter months of 2020, and the Australian dollar took full advantage by posting sharp gains. The New Year has been witness to a stronger US dollar, and this was apparent on Friday, as the US dollar pummelled the Aussie and gained 0.99% per cent. This marked AUD/USD’s strongest one-day gains since October. The US dollar’s broad gains on Friday were even more noteworthy, given that US released soft Retail Sales reports on Friday. Headline retail sales fell by 0.7% and core retail sales was even worse, with a decline of 1.4 percent. This marked back-to-back declines for both releases. The drop in consumer spending, a key driver of economic growth, is certainly worrying. At the same time, an important takeaway from this is that the soft US numbers aren’t necessarily translating into losses for the US dollar. With a massive number of short positions on the US dollar, the currency’s rebound of late has caused a short dollar squeeze and sent the dollar upwards. This movement has continued, even with the US posting weak retail sales and jobless claim numbers last week.