AUD/USD Price Analysis: Critical levels in view, will bulls throw in the towel?
- AUD/USD in the hands of the bears while below the critical structure.
- Bears remain committed and a test of the daily support structure could be on the cards.
0.7005 remains the line in the sand according to the daily chart and the following prior analysis:
AUD/USD Price Analysis: Bounded by support and resistance, watch for a breakout
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The chart above was the analysis given at the start of the week forecasting the current price action of today:
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The initial drop that has been eclipsed in the above chart represents a buying opportunity if the bears take in their profits.
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However, as illustrated in the above chart, there is no way of telling if the bulls are about to throw in the towel, so the 4-hour time frame is an appropriate place to monitor for price action and change of environment.
4-hour chart
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As it stands though, within a bearish environment, (price below 21-moving average, MACD below zero), the price has moved up to test the old support now turned resistance level.
If this structure holds, then a break of the daily support at 0.7005 makes a plausible case for a downside continuation.
In such a scenario, it would be expected that the market would complete a move to 0.6950 ahead of a 38.2% Fibonacci retracement of the monthly bullish impulse around 0.6680.
Author
Ross J Burland
FXStreet
Ross J Burland, born in England, UK, is a sportsman at heart. He played Rugby and Judo for his county, Kent and the South East of England Rugby team.
