AUD/USD: consolidating at lows, poised to extend decline
|AUD/USD Current price: 0.7276
- Gold prices falling despite mounting risk aversion, undermine the Aussie.
- Wall Street to set the upcoming direction for the AUD/USD pair.
The AUD/USD pair trades at fresh YTD lows, currently at 0.7276 after extending its decline overnight to 0.7262. The persistent risk-averse sentiment leads the way, in the absence of fresh macroeconomic data at the beginning of the week, although dollar's demand moderated after the Central Bank of Turkey announced they will provide all the liquidity needed to local banks, cooling down, at least temporarily, Lira's sell-off. Nevertheless, fear prevails, with equities barely holding above their daily lows, with gold also plummeting despite risk-aversion, weighing on the Aussie.
The pair is technically bearish, although now consolidating, and may resume its slump with Wall Street's opening, particularly if US equities extend their pre-opening slides. In the 4 hours chart, the 20 SMA maintains a strong downward slope far above the current level and below the larger ones, while technical indicators stand pat in oversold territory, giving not many clues on upcoming direction, as an upward corrective movement is not out of the table. The immediate resistance is the 0.7310/20 price zone, were selling interest should appear to maintain the dominant trend in place, while below 0.7250, the negative momentum will likely accelerate.
Support levels: 0.7250 0.7215 0.7290
Resistance levels: 0.7315 0.7340 0.7370
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