AUD/USD Outlook: Aussie Extends Weakness After Bulls Were Strongly Rejected

Technical analysis of Forex market

The Aussie dollar remains in red on Friday and cracks significant technical support at 0.7095 (converged 10/20SMA’s, following strong upside rejection on Thursday.

Recovery leg from 0.7003 (08 Mar low) stalled at strong barriers provided by 100SMA and daily cloud top (0.7160/71 respectively) and subsequent pullback resulted in repeated daily close below 55SMA (0.7132), weakening near-term structure.

Fresh strength of the US dollar in early European trading on Friday, further pressured its Australian counterpart.

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Weakening daily momentum and south-heading stochastic add to negative near-term outlook.

Sustained break below 10/20 SMA’s would open other pivotal supports at 0.7066/56 (Fibo 61.8% of 0.7003/0.7168/Wednesday’s low before Fed) and risk retest of key 0.70 support on stronger bearish acceleration.

Focus turns towards US Manufacturing PMI and housing data, due later today, that could provide fresh signals. Holding above 10/20SMA’s would delay bears, but only return and close above 55SMA would neutralize downside risk for renewed attacks at 100SMA/daily cloud top.

Res: 0.7105, 0.7117, 0.7132, 0.7160
Sup: 0.7088, 0.7066, 0.7056, 0.7041

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