- AUD/USD pauses CPI led slide, trades a narrow range in the Asian session.
- Worse-than-expected Australian Q3 CPI data dented RBA rate hike prospects while bolstering the central bank’s neutral bias.
- The major has taken support at 200-DMA at 0.7693, we see further weakness on break below.
- Technical bias is bearish. RSI and Stochs biased lower, RSI below 50. MACD shows bearish crossover. We see -ve DMI dominance and ADX is above 25 and rising.
- Focus now on US trade balance Initial Jobless Claims data for further impetus.
Support levels - 0.7693 (200-DMA), 0.7642 (50% Fib), 0.76, 0.7571 (July 5 low)
Resistance levels - 0.7756 (38.2% Fib retrace of 0.7160 to 0.8125 rally), 0.7761 (5-DMA), 0.78
Call update: Our previous call (http://www.econotimes.com/FxWirePro-AUD-USD-slumps-to-new-3-month-lows-as-markets-pare-back-RBA-tightening-expectations-following-weak-inflation-data-968705) has hit all targets.
Recommendation: Book full profits at lows. Watch for violation at 200-DMA for further downside.
FxWirePro Currency Strength Index: FxWirePro's Hourly AUD Spot Index was at -119.592 (Bearish), while Hourly USD Spot Index was at -0.395379 (Neutral) at 0420 GMT. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex.
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