- Aussie bulls fail to benefit from upbeat China data, AUD/USD slips from multi-month peaks at 0.7834.
- Data on Friday showed US headline CPI unchanged on a monthly basis and yearly rate sliding further below the Fed's 2.0% medium-term range.
- Adding to disappointing inflation figures, monthly retail sales data contracted for the second straight month, further diminishing prospects for additional Fed rate hike action.
- AUD/USD surged past 0.78 handle, highest since April 2016 on Friday.
- The pair is seeing some profit booking on the day, has slipped from highs of 0.7831 to currently trade at 0.7812 levels.
- The major finds immediate support at 0.78 (1H 20-SMA). Break below could see drag upto 0.7736 (5-DMA).
- Any break below 5-DMA could see extension of weakness. 20-DMA at 0.7637 will be next major support.
- Daily momentum indicators are in highly overbought zone, we see scope for some correction.
Support levels - 0.78 (1H 20-SMA), 0.7736 (5-DMA), 0.77, 0.7637 (20-DMA)
Resistance levels - 0.7835 (Apr 2016 high), 0.7849 (June 2015 high), 0.79, 0.7912 (Feb 2015 high)
Call update: Our previous call (Our previous call (http://www.econotimes.com/FxWirePro-AUD-USD-holds-20-DMA-support-bias-higher-good-to-go-long-on-dips-795926) has hit all targets.
Recommendation: We expect some consolidation at current levels. Watchout for break below 20-DMA for weakness.
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