AUD/USD Price Analysis: Bounces off 200-SMA but not out of the woods yet
|- AUD/USD suffers from broad risk-aversion, DXY rises to monthly tops.
- The 4H chart confirms bear flag breakdown, points to deeper losses.
- Sellers await entry below the fierce 200-SMA amid bearish RSI.
AUD/USD has stalled its two-day recovery mode, as sellers return on Tuesday, knocking off the rates below the 0.7750 level.
The aussie faced rejection once again at higher levels, now meandering near daily lows, as the US dollar’s haven demand gains traction amid worsening market mood in the European session.
The bulls surrendered the RBA’s status-quo-fuelled bounce, as broad risk aversion remains the key driver across the fx board. Attention now turns towards the Fedspeak and Australia’s Q4 GDP release for fresh trading impetus.
AUD/USD: Technical outlook
As observed on the four-hour chart, AUD/USD is challenging the powerful horizontal 200-simple moving average (SMA) at 0.7738, having charted a bear flag break down, earlier on.
The confirmation of the bearish continuation pattern suggests that the spot remains at a risk of deeper losses, with Friday’s low of 0.7692 in sight should the 200-SMA support give way.
Further south, the 0.7600 level could be challenged, as the bearish Relative Strength Index (RSI) keeps the sellers hopeful.
AUD/USD: Four chart
Alternatively, a bounce towards the 0.7800 mark cannot be ruled out if the 200-SMA support is well defended. The 21 and 100-SMA coincide at 0.78, forming a stiff resistance.
Buyers would need a strong foothold above the latter to extend further recovery moves.
AUD/USD: Additional levels
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