FxWirePro: AUD/USD upside capped below 5-DMA, focus on RBA SOMP

• AUD/USD extends grind lower after Doji formation on Wednesday's trade, upside capped below 5-DMA.
   
• Poor data from Australia and China released earlier today and broad based USD recovery to keep lid on the upside.
   
• Australia's trade surplus narrowed more than expected in June, came-in at AUD 856 million vs. expected print of AUD 1800 million.
   
• Further, China July Caixin services PMI came-in at 51.5, missing forecasts of 51.9.
   
• Oscillators have shown a rollover from overbought levels and MACD shows bearish crossover on signal line.
   
• 23.6% Fib retrace of 0.73728 to 0.80656 rally at 0.79 is immediate support. Violation there will take the pair to 20-DMA at 0.7864.
   
• Markets to remain cautious ahead of the RBA monetary policy statement and U.S. nonfarm payrolls due Friday which could pave further direction.
   
• Focus also on the country’s retail sales for the month of June, scheduled to be released on August 4.
   
• Bullish invalidation only on break above weekly 200-SMA at 0.8000.

Support levels - 0.7902 (23.6% Fib retrace of 0.73728 to 0.80656 rally), 0.7864 (20-DMA), 0.7801 (38.2% Fib)

Resistance levels - 0.7969 (5-DMA), 0.8000 (weekly 200-SMA), 0.81

Call update: Our previous call (http://www.econotimes.com/FxWirePro-AUD-USD-slips-below-5-DMA-Aussie-ignores-strong-Australia-housing-data-bias-lower-stay-short-833063) is progressing well.

Recommendation: Hold for targets.

FxWirePro Currency Strength Index: FxWirePro's Hourly AUD Spot Index was at -149.051 (Bearish), while Hourly USD Spot Index was at 33.5988 (Neutral) at 0600 GMT. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex.

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