AUDUSD almost touched July’s 26-month low of 0.6680 on Wednesday before bouncing up to finish the session with mild gains.
The soft upward move, however, was not enough to shift the odds to the bullish side as the RSI keeps pointing downwards well below its 50 neutral mark, while the MACD remains negatively charged below its zero and signal lines too.
Hence, the bears may stay on board for now, aiming for an aggressive attack towards the next barrier of 0.6550 once the base around 0.6680 gives way. Even lower, selling pressures could further intensify to meet the 0.6400 round level last active during April-May 2020. This is also where the 161.8% Fibonacci extension of the previous bullish wave is placed.
Otherwise, a continuation higher may initially re-challenge the weekly bar of 0.6825, where the 61.8% Fibonacci happens to be. Then, if the 0.6875 – 0.6900 constraining zone, which encapsulates the 20- and 50-day simple moving averages (SMAs) and the 50% Fibonacci, proves fragile this time, the recovery could extend towards the tentative descending trendline at 0.6962.
All in all, AUDUSD maintains a discouraging outlook near July’s low. A close lower is expected to motivate a sharp decline towards 0.6550.
