The Australian dollar cracked 0.6700 support on Friday, in extension of pullback after recovery attempts stalled on Wednesday.
Fresh pressure on Aussie comes from comments from Australia’s central bank’s governor Lowe, who pointed at lowered short-term growth forecast, but kept optimistic view for the longer term.
The RBA is reluctant to cut interest rates as the impact of the action is unclear and said that QE program would start if rates fall below 0.25%.
Fading risk mode also had a negative impact on Australian dollar as rising death toll on coronavirus increases fears in the market.
Technical studies remain bearish on daily chart and add to negative near-term outlook
Thursday’s repeated close below falling 10DMA generated negative signal, as today’s weakness complete reversal pattern.
Key supports at 0.6678/70 (4 Feb / 2 Oct 2019 lows) are under pressure and break here would risk acceleration towards 0.6261 (Fibo 76.4% of 2001/2011 0.4773/1.1079 ascend).
US report is in focus today and strong figures could further boost the US dollar and deflate Aussie.
Caution on failure to break below 0.6678/70 pivots that would complete inverted hammer candle on weekly chart and signal extended consolidation and possible rebound. Pivotal resistances lay at 0.6800/30 zone and only break here would generate reversal signal.
Res: 0.6728, 0.6762, 0.6774, 0.6800
Sup: 0.6694, 0.6678, 0.6670, 0.6600
