The Australian dollar accelerated lower on Wednesday and hit one-week low at 0.7281 in late Asian trading.
News that Beijing agreed to reduce tariffs on US made cars sent US stocks sharply lower and boosted the US dollar.
Downbeat Australian GDP data (Q3 0.3% q/q vs 0.6% f/c / Q3 2.8% y/y vs 3.3% f/c) added pressure on Aussie dollar, which holds in red for the third straight day.
Double-rejection at 0.7393 (Mon/Tue) and Tuesday’s bearish daily candle with long upper shadow, signaled that bulls were running out of steam.
Today’s fall filled Monday’s gap, adding to negative signals, as indicators on daily chart turned south and bear-leg off 0.7393 double-top cracked rising 10SMA (0.7284).
Over 50% of 0.7199/0.7393 upleg has been retraced so far, with pivotal supports at 0.7273 (Fibo 61.8% of 0.7199/0.7393) and 0.7266 (20SMA) being under pressure.
Close below 20SMA would generate bearish signal for possible extension towards higher base / daily cloud top at 0.7200 zone.
Hopes for fresh upside would remain alive while 20 SMA holds pullback, however, return above thick hourly cloud (spanned between 0.7338 and 0.7371) is needed to confirm scenario.
Res: 0.7305, 0.7355, 0.7393, 0.7414
Sup: 0.7281, 0.7273, 0.7266, 0.7238
