The AUD/USD pair ends the week around the 0.7300 level, shedding in the last ten trading days what it gained in over a month. The Australian dollar started the week with a positive tone, advancing against its American counterpart, meeting sellers in the 0.7430 price zone. It was all downhill from there as the market’s sentiment took a turn for the worse while Australian employment and inflation data fueled investors’ concerns. Australia reported that it lost 46.3K job positions in October, vs expectations of a 50K gain. The Unemployment Rate jumped to 5.25%, as the Participation Rate increased to 64.7%. At the same time, Consumer Inflation Expectations soared to 4.6% in November from 3.6% in the previous month. On a positive note, sentiment indicators improved, as Westpac Consumer Confidence improved to 0.6% in November, while October NAB’s Business Confidence printed at 21.

BULLISH AND BEARISH CONDITIONS/ POSSIBILITIES :

The AUD/USD pair seems to have set an interim top, and it is ready to resume its slide. It has fallen for two consecutive weeks after hitting 0.7555 and now trades below the 61.8% retracement of its 0.7169/0.7555 rally at around 0.7315, the immediate resistance level.

The weekly chart shows that it has accelerated its slump after breaking below its 20 SMA, while technical indicators rotate south and currently develop within negative levels. In the mentioned chart, the 100 and 200 SMAs converge around 0.7200, a price zone investors will be closely watching these days.

According to the daily chart, the risk is skewed to the downside. The pair is currently developing below all of its moving averages, while technical indicators stand near oversold readings, the Momentum heading firmly lower while the RSI consolidates around 37, with chances of resuming its decline.

A bearish extension could be confirmed with a break below 0.7270, the immediate support level, while the pressure could ease if the pair recovers beyond 0.7360, the 50% retracement of the mentioned rally.

Aussie has lost its bullish grounds

Nov 14 2021