ICM Technical Analysis : AUD/USD 6 March 2020

ICM Technical Analysis : AUDUSD – 6 March 2020

Snapping a three-day bullish phase, sellers strengthened their grip Thursday, guiding AUD/USD lower amid fresh global risk aversion weighing on perceived riskier currencies.

Technical resistance based on the H4 timeframe likely played a role in yesterday’s downside move. Capped by channel resistance, extended from the high 0.7031, a 61.8% Fibonacci retracement value at 0.6630 and a 161.8% Fibonacci extension point at 0.6651, the action marginally reclaimed 0.66 in recent hours. Though last Thursday’s top at 0.6591 could serve as support, logical support on the H4 scale can be seen around the 0.65 handle. Technicians will also note the relative strength index (RSI) turning lower south of overbought levels and testing the 50.00 value into the close.

Technical research on the daily timeframe has the unit suggesting scope for downside to support at 0.6508. Daily activity recently checked in with channel support-turned resistance, taken from the low 0.6677. Above here, nonetheless, could lead to resistance at 0.6677 making its debut.

AUD/USD on the weekly scale still, despite recent recovery this week, has eyes for support coming in at 0.6359. Eight out of nine weeks has seen the pair register losses, since topping a touch south of the 2019 yearly opening level at 0.7042, and completing a five-month rising wedge pattern. Note the primary trend has faced south since 2018, and we’re now testing decade lows in this market.

Areas of consideration:

The H4 close south of 0.66 is an interesting scenario, helping confirm seller intent off current H4 and daily resistances, targeting daily support underlined above at 0.6508, closely trailed by the 0.65 handle on the H4 timeframe.

Conservative traders may elect to wait and see if a retest forms at the underside of 0.66 before pulling the trigger; other traders may feel current price is a valid entry, knowing we’re beneath 0.66 off notable resistance.

Disclaimer: The information contained in this material is intended for general advice only.