AUD/USD Price Analysis: Eyes 0.7000 on Tweezer Tops formation
- The formation of Tweezer Tops candlestick pattern signals the conclusion of a positive pullback.
- The greenback bulls eye the test of psychological support at 0.7000.
- Momentum oscillator RSI (14) will weaken aussie bulls once it will tumble below 40.00
A pullback in the AUD/USD pair at around 0.7080 is going to turn into a bearish impulsive wave as it lacks conviction. The aussie bulls witnessed a steep fall on Thursday after struggling to sustain above 0.7250. The pair is looking to dive further as it has surrendered its entire gains recorded on Wednesday.
The formation of Tweezer Tops candlestick pattern that displays similar highs at around 0.7267 and a similar range of 189 pips is advocating the completion of a positive pullback. On the daily scale, potential support is placed at the January 28 low of 0.6966.
The aussie bulls have faced intense selling pressure from the 20-period Exponential Moving Average (EMA) at 0.7229. Also, the 50-EMA at 0.7287 is scaling lower, which adds to the downside filters.
The Relative Strength Index (RSI) (14) will trigger a bearish setup if it tumbles below 40.00 decisively. This may bring more weakness in the asset going forward.
A slippage below Thursday’s low at 0.7076 will trigger the formation of Tweezer Tops candlestick pattern and activate more sellers to a low of 0.7000 (the psychological support), followed by January 28 low of 0.6966.
On the flip side, the greenback bulls may lose control if the asset oversteps Wednesday’s high at 0.7266, which will send the asset towards the round level resistance at 0.7300. A breach of the latter will drive the asset towards April 19 low at 0.7344.
AUD/USD daily chart
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Author
Sagar Dua
FXStreet
Sagar Dua is associated with the financial markets from his college days. Along with pursuing post-graduation in Commerce in 2014, he started his markets training with chart analysis.
