AUD/USD: Bear flag breakdown puts Aussie on the defensive ahead of RBA's Lowe speech
- AUD/USD 15-minute chart shows a bear flag breakdown - a bearish continuation pattern.
- Dovish comments from RBA's Lowe would only bolster the already bearish technical setup.
The AUD/USD pair fell to 0.7559 - the lowest level since June 1, courtesy of a bearish technical setup.
The 15-minute chart shows a bear flag breakdown - a bearish continuation pattern, which indicates scope for a drop to 0.7520 (target as per the measured height method).
Also, the bear flag breakdown comes after the pair's failure to cut through falling trendline (drawn from Feb. 16 high and March 14 high).
Clearly, the Aussie dollar is on the defensive ahead of RBA Governor Lowe's speech. The central bank head will be speaking later today at an Australian Industry Group event in Melbourne.
The AUD/USD pair risks deeper sell-off if Lowe kills the already low odds of an RBA liftoff. On the other hand, upbeat comments on wage growth and inflation could put a bid under the Aussie dollar. As of writing, the spot is trading at 0.7574.
AUD/USD Technical Levels
Resistance: 0.7584 (resistance on hourly chart), 0.7602 (50-hour MA + 10-day MA), and 0.7624 (previous day's high).
Support: 0.7561 (June 8 low), 0.7544 (38.2% Fib R of May-June rally), 0.7513 (61.8% Fib R of May-June rally).
15-minute chart
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Daily chart
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Author
Omkar Godbole
FXStreet Contributor
Omkar Godbole, editor and analyst, joined FXStreet after four years as a research analyst at several Indian brokerage companies.
