|

AUD/USD Price Analysis: Dives to two-week low, bears flirt with 100-day SMA around 0.6715

  • AUD/USD drifts lower for the second straight day and drops to a two-week low on Friday.
  • A combination of factors continues to push the USD higher and exerts pressure on the pair.
  • Some follow-through selling below the 100-day SMA will pave the way for further losses.

The AUD/USD pair remains under some selling pressure for the second successive day on Friday - also marking the fifth day of a negative move in the previous six - and drops to a two-week low during the Asian session. Spot prices currently trade around the 0.6715 area, down 0.60% for the day, and now seems vulnerable to extend its recent pullback from a nearly four-month high touched last week.

The US Dollar (USD) gains some follow-through positive traction on Friday and builds on the previous day's goodish recovery move from its lowest level since May 11, which, in turn, is seen as a key factor exerting pressure on the AUD/USD pair. Federal Reserve (Fed) Chair Jerome Powell, during his two-day congressional testimony, repeated his view that interest rates will likely rise again this year to combat stubbornly high inflation. This, along with worries about a global economic downturn and a weaker risk tone, benefits the safe-haven buck and drives flows away from the risk-sensitive Aussie.

From a technical perspective, the intraday slide drags the AUD/USD pair below the 38.2% Fibonacci retracement level of the recent rally from the YTD low touched in May and is now flirting with the 100-day Simple Moving Average (SMA). Any subsequent fall is more likely to attract some buyers near the 0.6690-0.6680 confluence - comprising the very important 200-day SMA and the 50% Fibo. level. This should act as a pivotal point, which if broken decisively will set the stage for an extension of the recent rejection slide from the 0.6900 mark, or a nearly four-month high touched last Friday.

The AUD/USD pair might then accelerate the downfall towards the 0.6625 area, or the 61.8% Fibo. level, en route to the 0.6600 round-figure mark. Some follow-through selling will shift the bias in favour of bearish traders and pave the way for a slide towards the 0.6545-0.6540 intermediate support. Spot prices might then aim to challenge the 0.6500 psychological mark before eventually dropping to the YTD low, around the 0.6460-0.6455 region touched in May.

On the flip side, the 0.6730 zone, or the 38.2% Fibo. level, now seems to act as an immediate hurdle ahead of the daily top, near the 0.6765-0.6770 region. The next relevant hurdle is pegged near 23.6% Fibo. level, around the 0.6800 mark. A sustained strength beyond the latter will suggest that the corrective decline has run its course and lift the AUD/USD pair toward the 0.6855-0.6860 resistance. Spot prices might then make a fresh attempt to conquer the 0.6900 mark.

AUD/USD daily chart

fxsoriginal

Key levels to watch

AUD/USD

Overview
Today last price0.6715
Today Daily Change-0.0041
Today Daily Change %-0.61
Today daily open0.6756
 
Trends
Daily SMA200.6696
Daily SMA500.6681
Daily SMA1000.6716
Daily SMA2000.6692
 
Levels
Previous Daily High0.6806
Previous Daily Low0.6745
Previous Weekly High0.69
Previous Weekly Low0.6732
Previous Monthly High0.6818
Previous Monthly Low0.6458
Daily Fibonacci 38.2%0.6768
Daily Fibonacci 61.8%0.6783
Daily Pivot Point S10.6732
Daily Pivot Point S20.6708
Daily Pivot Point S30.667
Daily Pivot Point R10.6793
Daily Pivot Point R20.683
Daily Pivot Point R30.6855

Author

Haresh Menghani

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

More from Haresh Menghani
Share:

Markets move fast. We move first.

Orange Juice Newsletter brings you expert driven insights - not headlines. Every day on your inbox.

By subscribing you agree to our Terms and conditions.

Editor's Picks

EUR/USD rebounds after falling toward 1.1700

EUR/USD gains traction and trades above 1.1730 in the American session, looking to end the week virtually unchanged. The bullish opening in Wall Street makes it difficult for the US Dollar to preserve its recovery momentum and helps the pair rebound heading into the weekend.

GBP/USD steadies below 1.3400 as traders assess BoE policy outlook

Following Thursday's volatile session, GBP/USD moves sideways below 1.3400 on Friday. Investors reassess the Bank of England's policy oıtlook after the MPC decided to cut the interest rate by 25 bps by a slim margin. Meanwhile, the improving risk mood helps the pair hold its ground.

Gold stays below $4,350, looks to post small weekly gains

Gold struggles to gather recovery momentum and stays below $4,350 in the second half of the day on Friday, as the benchmark 10-year US Treasury bond yield edges higher. Nevertheless, the precious metal remains on track to end the week with modest gains as markets gear up for the holiday season.

Crypto Today: Bitcoin, Ethereum, XRP rebound amid bearish market conditions

Bitcoin (BTC) is edging higher, trading above $88,000 at the time of writing on Monday. Altcoins, including Ethereum (ETH) and Ripple (XRP), are following in BTC’s footsteps, experiencing relief rebounds following a volatile week.

How much can one month of soft inflation change the Fed’s mind?

One month of softer inflation data is rarely enough to shift Federal Reserve policy on its own, but in a market highly sensitive to every data point, even a single reading can reshape expectations. November’s inflation report offered a welcome sign of cooling price pressures. 

XRP rebounds amid ETF inflows and declining retail demand demand

XRP rebounds as bulls target a short-term breakout above $2.00 on Friday. XRP ETFs record the highest inflow since December 8, signaling growing institutional appetite.