AUD/USD Forecast: Slide set to continue despite oversold conditions

Valeria Bednarik FXStreet

AUD/USD Current Price: 0.6122

RBA Meeting Minutes could shed some light about the meeting called for later this week.
Falling equities and commodities weighed on the Aussie at the beginning of the week.
AUD/USD at risk of falling further amid continued risk-aversion.

The Australian dollar kept shedding ground against its American rival this Monday, down for a sixth consecutive day. The pair fell to 0.6078, its lowest since November 2008, heading into the Asian opening trading at around 0.6120. The pair peaked at 0.6303 at the beginning of the week, as the Fed’s unexpected decision to cut rates by 100 bps hit the greenback, although the movement was short-lived. The pair quickly turned south as equities plummeted, while commodities also came under strong selling pressure, as investors rushed into government bonds. The pair has bounced just modestly as demand for the greenback paused following dismal US data.

The RBA will release the Minutes of its latest meeting this Tuesday, although as it happens with other data, the market will probably see it as old news. More relevant, the Australian Central Bank has scheduled a meeting for next Thursday, and will likely cut rates further.

AUD/USD short-term technical outlook

The AUD/USD pair is bearish according to the 4-hour chart, although extreme daily oversold conditions lift odds for a bullish corrective movement. Nevertheless, the short-term picture shows that technical indicators remain within negative levels, with the RSI consolidating within oversold levels, as the pair keeps developing below bearish moving averages.

Support levels: 0.6120 0.6090 0.6060

Resistance levels: 0.6225 0.6250 0.6280

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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