AUD/USD Technical Analysis: Trims a part of early strong gains to 3-week tops

The AUD/USD pair added to the previous session's strong gains and gained some follow-through traction on Tuesday. A sustained move beyond the 100-day SMA barrier was seen as a key trigger for bullish traders and lifted the pair to over three-week tops, levels just above mid-0.6800s.

However, the latest trade pessimism, led by the US President Donald Trump's comments, exerted some fresh pressure on the China-proxy Australian dollar and kept a lid on the pair's momentum near a resistance marked by 61.8% Fibonacci level of the 0.6930-0.6754 recent downfall.

Slightly overbought conditions on hourly charts also seemed to be one of the key factors contributing to the pair's intraday pullback of around 20-25 pips. Meanwhile, oscillators on the daily chart have just started gaining positive traction and support prospects for a further near-term positive move.

Given that the Reserve Bank of Australia (RBA) held back from offering any hints about any further rate cuts at its latest policy meeting earlier this Tuesday, any subsequent slide back towards the 100-DMA, coinciding with 38.2% Fibo. level might still be seen as a buying opportunity.

Failure to defend the mentioned confluence support, around the 0.6820 region, will negate the constructive set-up and prompt some aggressive technical selling. The pair then might turn vulnerable to slide below the 23.6% Fibo. level, near the 0.6795 region, back towards last week's swing low, around the 0.6760 region.

AUD/USD daily chart