AUDUSD has become impulsive and non-volatile after rejecting the 0.7210 to 0.7240 resistance level. AUDUSD dropped below the 0.7100 area and had a daily bearish close. Bears to hold the momentum? What are the charts and technical indicators are saying? Read more to find further insights into today’s AUD/USD Technical Analysis.
October 19, 2020, | AtoZ Markets – AUDUSD is currently trading around 0.7080 area and trying to decline. The price was also broke below the dynamic level of 20 EMA on the daily chart. As per the current price action, the price may face strong support around 0.7010 to 0.7000 in the coming days.
Two senior Fed authorities told the Financial Times in an article published on Saturday that, “Harder U.S. monetary guideline is expected to evade the ascent of unnecessary risk-taking and resource bubbles in the markets at a time when the Federal Reserve is keeping interest rates low” Moreover, Boston Fed President Eric Rosengren told the newspaper that the Fed needed adequate tools to keep organizations and families from taking on “exorbitant leverage” and required a reexamine on issues related to the U.S. monetary steadiness.
On the other hand, the Australian economy is seeing a downturn over and over again. Starting from GDP to Employment, Australia has been struggling to build up momentum for the bulls to maintain the upward pressure against the USD.
AUDUSD Dropped Below as the Fed Keeping the Interest Rates Low
AUDUSD is currently residing near the 0.7080 area and trying to push lower. However, the price also broke below the Kumo Cloud impulsively on the intraday chart, which indicates that bears are quite strong may sustain the bearish pressure further in the process.
Image: AUDUSD 4 Hour Chart
According to the 4-hour chart, AUDUSD dropped below and currently residing near the 0.7080 area. As per the current price action, if the price can have an impulsive bearish candle close below 0.7100 to 0.7110 area, the bears may sustain the bearish pressure towards 0.7010 to 0.7000 support level in the days ahead. Alternatively, if the price can break above0.7100 to 0.7110 resistance level with an impulsive bullish candle close, the bulls may recover higher towards the 0.7210 to 0.7240 area in the process.
Furthermore, the dynamic level of 20 EMA is currently residing above the price. Along with the Kijun line. The dynamic level may work as strong resistance to push the price downside. Besides, the Kijun line may work as a confluence of the dynamic level in the process.
AUDUSD May Decline Towards June’s Low
According to the daily chart, AUDUSD dropped below and currently trading around the 0.7080 area. As per the current price action, if the price can have an impulsive daily bearish candle close below 0.7100 to 0.7110 area, the bears may push the price downside towards 0.7010 to 0.7000 area as a first target. The second target will be the 0.6840 to 0.6800 key support area if the price can break below the 0.7010 to 0.7000 area in the coming days.
Image: AUDUSD Daily Chart
In addition, the dynamic level of 20 EMA is currently residing above the price. It may work as strong resistance to push the price down in the coming days. Also, the MACD lines are currently residing below the 0.00 level and gradually slopping downside. It indicates that bears may continue the bearish pressure further in the days ahead.
To conclude, after retracing to 0.7210 to 0.7240 resistance area, the bears have regained momentum and pushed down the price quite impulsively. An impulsive daily close below 0.70 is required to identify the definite momentum in the coming days.