Bears await sustained break and acceptance below 0.6500 mark – Crypto News – Crypto News
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Bears flex muscles to revisit 0.6850 support Bears flex muscles to revisit 0.6850 support

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Bears await sustained break and acceptance below 0.6500 mark – Crypto News

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2 years ago

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  • AUD/USD meets with a fresh supply on Friday and drops back closer to the weekly low.
  • Weaker Chinese trade data undermine the Aussie amid strong follow-through USD buying.
  • The technical setup favours bearish traders and supports prospects for additional losses.

The AUD/USD pair comes under some renewed selling pressure on Friday and extends its steady intraday descent through the early part of the European session. Spot prices touch a fresh daily low following the release of weaker Chinese trade data, albeit manage to hold above the 0.6500 psychological mark and rebound a few pips in the last hour.

Any meaningful recovery, however, still seems elusive in the wake of strong follow-through US Dollar (USD) buying, bolstered by expectations that the Federal Reserve (Fed) will keep interest rates higher for longer amid sticky US inflation. Apart from this, persistent geopolitical tensions stemming from conflicts in the Middle East benefit the safe-haven Greenback and might further contribute to capping the risk-sensitive Aussie.

From a technical perspective, the AUD/USD pair, so far, has managed to defend the 0.6500 mark, which should now act as a key pivotal point. Given that oscillators on the daily chart have just started gaining negative traction, a convincing break below will be seen as a fresh trigger for bearish traders and set the stage for an extension of the recent sharp pullback from the 0.6645 area, or a one-month high touched earlier this week.

Some follow-through selling below the 0.6480 area, or the monthly low, will reaffirm the negative bias and allow the AUD/USD pair to aim back to challenge the YTD trough, around the 0.6445-0.6440 region touched in February. The downward trajectory could extend further towards the 0.6400 mark en route to the next relevant support near the 0.6355-0.6350 zone.

On the flip side, any attempted recovery is likely to confront stiff resistance near the 0.6545-0.6555 region, which coincides with the very important 200-day Simple Moving Average (SMA). This is followed by the 100-day SMA, currently pegged near the 0.6600 mark, above which a bout of a short-covering move has the potential to lift the AUD/USD pair back towards the 0.6640-0.6645 area, or the monthly swing high.

AUD/USD daily chart

 

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