- AUD/USD extends the previous day’s pullback from five-month high, renews weekly low.
- Confirmation of bearish chart pattern, sustained break of 50-SMA favor sellers.
- 200-SMA, monthly support line probe bears even as oscillators suggest further downside.
AUD/USD remains on the back foot for the second consecutive day after refreshing the multi-month high, down half a percent as bears poke the 0.6900 threshold during early Thursday.
In doing so, the Aussie pair justifies the previous confirmation of the two-week-old rising wedge bearish chart pattern, as well as the 50-SMA breakdown.
Also favoring the AUD/USD pair in refreshing the weekly low is the downbeat RSI (14) line, not oversold, as well as the bearish MACD signals.
That said, the rising wedge confirmation signals the theoretical target of around 0.6630 but the RSI line has limited room before it hits the oversold territory. As a result, the 200-SMA and an upward-sloping support line from December 20, 2022, respectively near 0.6800 and 0.6785, could challenge the AUD/USD sellers.
Meanwhile, recovery moves need to cross the 50-SMA hurdle of 0.6945 to restore bullish confidence.
Following that, the lower line of the stated wedge, close to 0.6980, precedes the 0.7000 psychological magnet to probe the upside momentum.
In a case where the AUD/USD price remains firmer past 0.7000, the monthly high of 0.7065 and the August 2022 peak surrounding 0.7135, will gain the market’s attention.
Overall, AUD/USD is likely to decline further but the downside room appears limited.
AUD/USD: Four-hour chart
Trend: Further downside expected
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
Australian Dollar extends gains despite mixed PMI
The Australian Dollar (AUD) continues to strengthen against the US Dollar (USD) following the release of mixed Judo Bank Purchasing Managers' Index (PMI) data from Australia on Friday. The AUD also benefits from a hawkish outlook by the Reserve Bank of Australia (RBA) regarding future interest rate decisions.
Japanese Yen fails to build on stronger CPI-led intraday uptick against USD
The Japanese Yen (JPY) attracted some follow-through buying for the second successive day following the release of slightly higher-than-expected consumer inflation figures from Japan. This comes on top of Thursday's hawkish remarks from BoJ Governor Kazuo Ueda, which keeps expectations for a December interest rate hike in play.
Gold price advances to near two-week top on geopolitical risks
Gold price touched nearly a two-week high during the Asian session as the worsening Russia-Ukraine conflict benefited traditional safe-haven assets. The weekly uptrend seems unaffected by bets for less aggressive Fed policy easing, sustained USD buying and the prevalent risk-on environment
Ethereum Price Forecast: ETH open interest surge to all-time high after recent price rally
Ethereum (ETH) is trading near $3,350, experiencing an 10% increase on Thursday. This price surge is attributed to strong bullish sentiment among derivatives traders, driving its open interest above $20 billion for the first time.
A new horizon: The economic outlook in a new leadership and policy era
The economic aftershocks of the COVID pandemic, which have dominated the economic landscape over the past few years, are steadily dissipating. These pandemic-induced economic effects are set to be largely supplanted by economic policy changes that are on the horizon in the United States.
Best Forex Brokers with Low Spreads
VERIFIED Low spreads are crucial for reducing trading costs. Explore top Forex brokers offering competitive spreads and high leverage. Compare options for EUR/USD, GBP/USD, USD/JPY, and Gold.