The Australian dollar stands at the front foot on Wednesday, as comments of US President Trump over Huawei case boosted risk assets, but upside action was so far limited.
Initial resistance at 0.7228 (100SMA/Fibo 23.6% of 0.7393/0.7177) capped recovery, with long shadows on daily candles of past three days suggesting that recovery attempts face strong headwinds and may stall.
Bearishly aligned daily techs support the notion. Repeated failure at 0.7228 would increase risk of return to 0.7177 (10 Dec low) and possible attack at key near-term support at 0.7163 (Fibo 61.8% of 0.7020/0.7393/daily cloud base), loss of which would generate strong bearish signal. Only lift and close above upper pivots at 0.7260 zone (Fibo 38.2% of 0.7393/0.7177/converged 10/20SMA’s) would neutralize bearish threats and open way for stronger recovery.
Res: 0.7228, 0.7260, 0.7285, 0.7311
Sup: 0.7195, 0.7177, 0.7163, 0.7139
