Tumbles towards 0.7155 support confluence

  • AUD/USD extends the previous day’s losses, renews intraday low of late.
  • Convergence of the 100-EMA, 200-EMA challenge bears ahead of the key Fibonacci retracement levels.
  • Weekly resistance line holds the key to fresh upside.

AUD/USD remains on the back foot around the intraday low, on its way to the first weekly loss in four, as bears approach key EMA confluence. That said, the Aussie pair drops to 0.7175 while taking rounds to the daily lows during Thursday’s Asian session.

Given the downward sloping RSI (14) line, coupled with the pair’s sustained tracing of the weekly resistance line, AUD/USD prices are likely to witness further declines.

However, bears need a clear downside of the 0.7155 key level, including 100-EMA and 200-EMA, to retake control.

Following that, the 38.2% and 50% Fibonacci retracements (Fibo.) of the pair’s May-June upside, near 0.7110 and 0.7055 in that order, could challenge the AUD/USD bears.

Meanwhile, recovery moves must cross the weekly hurdle surrounding 0.7220 to challenge the monthly peak of 0.7283.

In a case where AUD/USD bulls keep reins past 0.7283, a run-up towards the late April swing high near 0.7460 can’t be ruled out.

AUD/USD: four-hour chart

Trend: Further weakness expected

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