AUD/USD: Topping Out, July Correction More Likely; Looking To Sell On Rallies Into 0.70 – BofA

What is the technical outlook for AUD/USD in July?

Here is their view, courtesy of eFXdata:

Bank of America Global Research discusses AUD/USD technical outlook and flags a scope for topping pattern in the making.  

“In G10, we think AUD/USD remains vulnerable to a deeper correction. Strong resistance around the .70 area has held. An initial decline has occurred that broke below a trend line as the BBDXY bounced. MACD has crossed bearish and RSI is still pointing lower.  We favor tactically bearish AUD/USD trades especially in the .6850-.70 area  as the 200d at .6666 and/or the 38.2% retracement at .6470 could be seen,” BofA notes.

“What we don‘t have, and wish we did to increase conviction, is a formal top pattern such as a double top. This is why we preferred to sell into .70 area this month  and foresee a July correction.  Should new YTD highs occur then a surge to the upper green line in the .72s may occur,”BofA adds.