- AUD/USD witnessed some aggressive selling and extended the overnight pullback from YTD tops.
- Bears now await a sustained break below the 0.6900 mark before positioning for a further slide.
- Diverging indicators on hourly/daily charts warrant some caution before placing directional bets.
The AUD/USD pair maintained its heavily offered tone through the mid-European session and was last seen trading near daily lows, around the 0.6915-10 region.
Bears might now be looking to extend the slide further below 1-1/2-week-old trend-line support. This is closely followed by 200-hour EMA around the 0.6900 mark, which coincides with the lower end of the weekly trading range and should act as a key pivotal point for short-term trades.
Meanwhile, technical indicators on the 4-hourly chart have just started drifting into the bearish territory and support prospects for additional weakness. However, bullish oscillators on the daily chart support prospects for the emergence of some dip-buying.
The diverging indicators on hourly/daily charts warrant some caution before placing any aggressive directional bets. That said, a convincing break below the 0.6900 mark might prompt some technical selling and lead to some follow-through pullback from YTD tops set on Wednesday.
Below the mentioned level, the pair is likely to accelerate the slide towards the 0.6855 support area. Some follow-through selling now seems to accelerate the fall further towards the 0.6820-15 region before bears eventually aim to drag the pair below the 0.6800 round-figure mark.
On the flip side, any meaningful recovery attempt now seems to confront stiff resistance near the 0.6950-60 region, which if cleared decisively might prompt some intraday short-covering move. This, in turn, should assist the pair to move back towards reclaiming the key 0.70 psychological mark.
AUD/USD 1-hourly chart
Technical levels to watch
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