- The pair managed to find decent support ahead of the 0.6700 mark.
- Sustained move beyond 100-hour SMA needed for any further gains.
The AUD/USD pair extended its overnight rejection slide from 100-hour SMA and dropped to the 0.6700 neighbourhood during the Asian session on Friday, albeit managed to rebound around 15-pips thereafter.
The ongoing slide – marking the fourth consecutive day of a downtick – found some support near a short-term descending trend-line, extending from Tuesday, which should now act as a key trigger for bearish traders.
Meanwhile, technical indicators on hourly/daily charts have struggled to recover from the negative territory and support prospects for further near-term weakness, despite the latest optimism over US-China trade spat.
Hence, it will be prudent to wait for a decisive move – either beyond the 100-hour SMA barrier or below the mentioned descending trend-line support – before traders start positioning for the pair’s next leg of a directional move.
Failure to defend the 0.6700 round figure mark will set the stage for the resumption of the prior/well-established bearish trend and accelerate the slide further towards challenging multi-year lows – around the 0.6680-75 region.
A follow-through selling has the potential to continue dragging the pair further towards the 0.6600 round figure mark en-route the next major support near mid-0.6500s, levels now seen since March 2009.
On the flip side, immediate resistance is pegged near the 0.6735 horizontal zone and is closely followed by 100-hour SMA – currently near mid-0.6700s – above which the pair is likely to head towards reclaiming the 0.6800 handle.
AUD/USD 1-hourly chart
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