- AUD/USD struggled to capitalize on the early uptick to fresh three-year tops.
- Overbought conditions prompted profit-taking amid a modest USD rebound.
- Weakness below the overnight swing low would negate any positive outlook.
The AUD/USD pair witnessed a modest pullback from three-year tops and slipped below the 0.7900 round-figure mark during the first half of the European session.
A turnaround in the global risk sentiment provided a modest lift to the safe-haven US dollar and drove flows away from the perceived riskier aussie. This, along with overbought conditions on short-term charts, prompted some profit-taking around the AUD/USD pair.
The pair, for now, seems to have snapped three consecutive days of the losing streak and dropped to support marked by the 23.6% Fibonacci level of the 0.7724-0.7936 recent positive move. A subsequent fall below the mentioned area might prompt some technical selling.
The AUD/USD pair might then accelerate the corrective slide towards the overnight swing lows, around the 0.7855 region. This coincides with the 38.2% Fibo. level, which if broken will negate any positive bias and pave the way for a further near-term corrective slide.
The downward trajectory would set the stage for a slide towards testing the 61.8% Fibo. level, around 0.7800 round-figure mark. This is closely followed by support near the 0.7785-80 horizontal zone before the AUD/USD pair eventually drops to the 0.7750-45 support.
On the flip side, the 0.7935 region (three-year tops) now becomes immediate strong resistance. Bulls might wait for some follow-through buying before positioning for any further appreciating move towards reclaiming the key 0.8000 psychological mark.
AUD/USD 4-hourly chart
Technical levels to watch
Share
