AUD/USD remained under some selling pressure for the third consecutive session on Thursday. COVID-19 jitters, the prevalent risk-off environment took its toll on the perceived riskier aussie. Sliding US bond yields kept the USD bulls on the defensive, though did little to lend any support. Record highs in Wall Street amid an upbeat mood underpinned the AUD. Softer than anticipated Australian macroeconomic figures capped the upside.AUD/USD modest recovery is not enough to grant further gains ahead.

Australian data was softer than anticipated, preventing the aussie from posting substantial gains. The preliminary estimate of May Retail Sales printed at 0.1%, down from 1.1% final in April. The June flash Commonwealth Bank PMIs held within expansion territory but contracted from a month earlier.

From the current level, supports come in at 0.7390 and 0.73340, followed by the 0.7400 price zone. The immediate resistance level is 0.7620, with a break above it favoring an extension towards the 0.7700 region.

As of for now the previous trend line with its resistance being shown at 0.75354 near EMA200 which will be Aussies destination for now while a breakout above will further provide a throttle to the pair towards 0.76000 that is near EMA50 with strong resistance and 38.2 fibb level. Price action above 0.75600 will be an indication in itself to let the pair run for its daily highs where its upper trend line is I.e 0.77200, near 50fibb level.

Keep in mind that AUDUSD has broken some major price action levels and is within a strong bearish rally, any upside move shouldnt be considered more than temporary reversal, take your positions in the dovish direction once the near term major resistances are met, after that Aussie is more leaned towards continuing this quarter onto favouring sellers. We will update you as soon as there is a new structure formation in this pair which will only be possible if the upper trend line is broken which for now should be considered as a more better price for selling shares in the Aussie dollar.

Aussie preparing for a bullish correction

Jul 08 2021

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