AUD/USD seems vulnerable near three-month low, below 0.7200 mark


  • AUD/USD failed to preserve its modest intraday gains, or find acceptance above the 0.7200 mark.
  • The divergent Fed-RBA monetary policy outlooks support prospects for additional near-term losses.

The AUD/USD pair witnessed some selling during the first half of the European session and dropped to a near three-month low, around the 0.7180 region in the last hour.

Having struggled to find acceptance above the 0.7200 mark, the AUD/USD pair met with fresh supply on Thursday and now seems all set to prolong a near one-month-old bearish trend. The intraday US dollar profit-taking slide remained cushioned amid hawkish Fed expectations, which, in turn, acted as a headwind for the major.

The markets seem convinced that the Fed would be forced to raise interest rates sooner rather than later to contain stubbornly high inflationary pressures. The bets were reinforced by Wednesday's release of the US PCE Price Index – which accelerated to a 30 year high in October – and the FOMC monetary policy meeting minutes.

In fact, the Fed officials were open to speeding up the tapering of the bond-buying program and move quickly to raise interest rates if high inflation persists. Conversely, the Reserve Bank of Australia has made every effort to push back expectations for a rate hike. The Fed-RBA divergent policy outlooks favour the AUD/USD bears.

That said, relatively thin liquidity conditions on the back of the Thanksgiving holiday in the US might hold back traders from positioning for any further intraday slide. Nevertheless, the AUD/USD pair seems vulnerable to breakthrough intermediate support near the 0.7170 region and challenge YTD low, around the 0.7100 mark touched in August.

Technical levels to watch

AUD/USD

Overview
Today last price 0.7189
Today Daily Change -0.0010
Today Daily Change % -0.14
Today daily open 0.7199
 
Trends
Daily SMA20 0.7354
Daily SMA50 0.7347
Daily SMA100 0.735
Daily SMA200 0.7526
 
Levels
Previous Daily High 0.723
Previous Daily Low 0.7183
Previous Weekly High 0.7371
Previous Weekly Low 0.7227
Previous Monthly High 0.7557
Previous Monthly Low 0.7191
Daily Fibonacci 38.2% 0.7201
Daily Fibonacci 61.8% 0.7212
Daily Pivot Point S1 0.7178
Daily Pivot Point S2 0.7157
Daily Pivot Point S3 0.7131
Daily Pivot Point R1 0.7225
Daily Pivot Point R2 0.7251
Daily Pivot Point R3 0.7272

 

 

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