AUD / USD Technical Strategy: BEARISH
- AUD sellers struggle to sustain momentum after touching 4-month lows
- Positive RSI divergence hints at possible bounce as RBA meeting looms
- Overall positioning continues to carry a bearish bias while sub-0.7147
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The Australian Dollar turned lower anew after a letter corrective upswing against its US counterpart, as expected , Sellers have struggled to gain ground beyond reversing the relief rally from April lows however. A drop to four-month lows failed to find lasting follow-through, putting prices back in a family range just below the 0.70 figure. The proximity of the RBA rate decision may have sapped conviction.
Furthermore, positive RSI divergence hints that ebbing downside momentum may precede a reversal higher. Swing top, now at 0.7009. Pushing beyond that would neutralize immediate selling pressure and put the 0.7049-73 chart inflection area back in focus.
Zoom out to the daily chart implications. AUD / USD price decrease in the beginning of the year. Completing it would require a daily close below support's outer layer at 0.6982. That would expose the 0.69 figure next.
Triangle top resistance, now at 0.7147. Doing so would put AUD / USD back in the congestive range prevailing since last last year. To make a convincing bullish bias, prices would need to work across the top at 0.7393.
AUD / USD TRADING RESOURCES
— Written by Ilya Spivak, Currency Strategist for DailyFX.com
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