- AUD/USD in the red for the 2nd straight session, as US Dollar finds its footing again.
- The major pauses its stellar rally, edges lower from 2-1/2 year highs at 0.8035.
- Upside in the pair remains capped at 0.81 handle, intraday bias slightly bearish.
- We evidence bearish divergence from price action on RSI and Stochs which raises scope for downside.
- Stochs are at overbought levels and RSI is on verge of rollover from overbought levels.
- Price ignores bullish engulfing pattern, slips lower to test 5-DMA at 0.8072. Close below will see further downside.
- Immediate major support lies at 1H 200-SMA at 0.8036. Scope then for test of 0.7986 (23.6% Fib retrace of 0.7501 to 0.8135 rally) on break below.
Support levels - 0.8072 (5 DMA), 0.8036 (1H 200-SMA), 0.80, 0.7986 (23.6% Fib retrace of 0.7501 to 0.8135 rally)
Resistance levels - 0.8125 (2017 high), 0.8166 (50% Fib retrace of 0.9505 to 0.6827 fall), 0.8220 (channel top)
Recommendation: Watch out from break below 5-DMA for further downside, target 0.8035/ 0.80/ 0.7985.
FxWirePro Currency Strength Index: FxWirePro's Hourly AUD Spot Index was at -67.5518 (Bearish), while Hourly USD Spot Index was at 85.8564 (Neutral) at 0540 GMT. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex.
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