- Friday’s retreat from 113.49 to 112.56 adds credence to bearish break below 50-DMA on Thursday and open doors for a sell-off to 111.73 (confluence of channel support and lower Bollinger band).
- Under 111.73, the spot would run into an immediate support at 111.60 (Feb low). Only a daily close below 111.60 would signal the continuation of the retreat from The December high of 118.66 levels.
- The daily RSI is below 50.00 sloping downwards, but still sufficiently away from the oversold territory. That signal potential for a drop to 111.73-111.60 levels.
- On the higher side, only a daily close back above the 50-DMA would signal bearish invalidation.
AUD/USD Forecast: Could target the upper end of the Bollinger band this week
- Failure to take out the weekly 50-MA earlier this month, followed by a blast higher last week not only kept the RSI above 50.00, but also suggests the retreat from the late Feb high of 0.7741 was corrective move.
- This, coupled with the highest weekly close (above 0.77) since April 2016 has opened doors for 0.7814 (upper end of the Bollinger band).
- On the downside only a daily close below 0.76 would signal bullish invalidation.
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