AUD/USD analysis: bearish potential increased

Valeria Bednarik FXStreet

AUD/USD Current price: 0.7469

The AUD/USD pair fell to 0.7454, its lowest since mid January, ending the day nearby and poised to extend its slide. The Aussie got hit at the beginning of the day by Australian quarterly inflation figures, as the Q1 CPI printed 0.5% compared to market´s median of 0.6%. The annual rate advanced 2.1%, above previous quarter 1.5% but also slightly below expected, while the core reading rose0.4% compared to the market’s forecast of a 0.5% rise. Despite far from negative, the readings suggest that the RBA will remain on hold, resulting in a weakening AUD. The positive sentiment around the greenback exacerbated the decline, with the pair settling a few pips above the mentioned low. The 4 hours chart shows that the price is well below a now bearish 20 SMA, whilst technical indicators have partially lost their bearish strength, but remain within oversold territory, suggesting some upcoming consolidation rather than downside exhaustion. The pair is at risk of falling further, particularly on a decline below 0.7410, with scope then to extend its slide towards the 0.7250 region during the upcoming days.

Support levels: 0.7450 0.7410 0.7370

Resistance levels: 0.7500 0.7530 0.7570

View Live Chart for the AUD/USD

Author

Valeria Bednarik

FXStreet

Valeria Bednarik was born and lives in Buenos Aires, Argentina. Her passion for math and numbers pushed her into studying economics in her younger years.

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