AUDUSD at fresh decade lows; vulnerable to more downside

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AUDUSD slumped to a fresh 10 ½-year low of 0.6670 on Tuesday, signaling that the more-than-a-year bearish wave is here to stay, with the negative direction in the RSI and the MACD backing this view as well.

The next support to downside movements could emerge within the 0.6565-0.6500 area, while lower the bears should break a tougher wall around 0.6400 to stretch the decline towards the 0.6280-0.6248 restrictive zone, taken from the lows in 2009.

On the upside, there are several barriers to overcome before the price eventually touches the descending trend-line drawn from the 0.7392 peak, a break of which could signal the end of the negative pattern. The 0.6745 level could first act as resistance before the 20-day simple moving average (SMA) – currently at 0.6800 – comes into view. Above the latter, the door would open for the 0.6865-0.6910 zone.

In the bigger picture, the bearish sentiment remains strongly intact as the pair continues to print lower lows and lower highs. The falling 50-day SMA, which shows no sign of cancelling the bearish cross with the 200-day SMA, is another indication that an outlook reversal is not likely to happen anytime soon.

Summarizing, AUDUSD sellers are expected to keep control as long as the price trades below the downward-sloping trend-line.

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