AUD/USD Price Analysis: Gathers momentum for a breakdown below 0.6400
|- Oscillation around 0.6400 indicates a build-up of shorts for a breakdown.
- Declining 50-and 200-EMAs add to the downside filters.
- The RSI (14) has shifted into the bearish range of 20.00-40.00.
The AUD/USD pair is displaying back-and-forth moves in a narrow range of 0.6400-0.6422 in the Tokyo session. The asset has turned sideways after a perpendicular fall from 0.6540 as the market sentiment turned extremely sour on geopolitical tensions and a downward revised outlook on growth prospects from the International Monetary Fund (IMF).
On an hourly scale, the asset has been auctioning in an inventory adjustment process chartered in a 0.6390-0.6548 range. As the major is still oscillating inside the defined territory, it is difficult to tag it as a breakout or a breakdown. It is worth noting that the asset is oscillating near the lower portion around 0.6400. The sideways auction is followed by a perpendicular fall, therefore, chances are the greenback bulls are gathering momentum for a downside break.
Meanwhile, the 50-and 200-period Exponential Moving Averages (EMAs) at 0.6494 and 0.6457 respectively have titled towards the south, which indicates weakness ahead.
Also, the Relative Strength Index (RSI) (14) has shifted into the bearish range of 20.00-40.00, which adds to the downside filters.
Going forward, a drop below the two-year low at 0.6363 will drag the asset towards the 16 April 2020 low at 0.6264, followed by the round-level support at 0.6100.
On the flip side, a break above Tuesday’s high at 0.6547 will drive the asset toward September 22 high at 0.6670 and September 18 high at 0.6734.
AUD/USD hourly chart
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