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The Australian dollar traded higher recently against the US dollar, but it looks like it failed to maintain the momentum. There were a couple of economic releases lined up in Australia, which pushed the AUDUSD pair lower in the near term. The AIG Performance of Services Index presenting business conditions in the Australian service sector was released by the Australian Industry Group. The outcome was a bit on the lower side when compared to the last reading, as it came in at 50.2 down from the last 51.7. The AUDUSD pair moved lower and breached an important support area to trim all of the recent gains.
There was a major bullish trend line formed on the hourly chart of the AUDUSD pair, which was acting as a support and was breached by the Aussie dollar sellers. The most important point is that the pair settled below the 100 hourly simple moving average, which is a strong sell signal. We need to see whether the pair can correct higher or not. Initial hurdle in that situation would be around the 100 hour MA. The next one might be around the 50% fib retracement level of the last leg from the 0.7694 high to 0.7576 low, which is also sitting around the broken trend line. The hourly RSI is also below the 50 level signalling more losses in AUDUSD.
If the AUDUSD pair moves lower from the current levels, then a break below the recent low might take it towards 0.7550.
Overall, one might consider selling rallies in the AUDUSD pair as long as the pair is below the 50% fib level.