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AUD/USD declines for 4th straight session, breaks below 5-dma, bias lower

 AUD/USD declines for 4th straight session, breaks below 5-dma, bias lower

  • AUD/USD accelerated decline on Wednesday on bullish FOMC outcome, slipped below 5-DMA support.
  • Dollar strengthened as Fed said they expect economic conditions to evolve in a manner that will warrant further rate hikes.
  • Aussie sold-off following disappointing Building Permits data for the month of December also weighing on the pair.
  • Technical studies support weakness, bearish divergence on RSI and Stochs keep scope for downside. Stochs and RSI are showing rollover from overbought levels.
  • Price has broken immediate support at 1H 200-SMA (currently at 0.8055). Scope now for test of 0.7986 (23.6% Fib retrace of 0.7501 to 0.8135 rally).

Support levels – 0.80 (psychological level), 0.7986 (23.6% Fib retrace of 0.7501 to 0.8135 rally)

Resistance levels – 0.8074 (5-DMA), 0.8125 (2017 high)

Recommendation: Bias lower, stay short for further downside.

FxWirePro Currency Strength Index: FxWirePro’s Hourly AUD Spot Index was at -87.1897 (Bearish), while Hourly USD Spot Index was at -27.8808 (Neutral) at 0500 GMT.

Source: FXWire Technicals

 

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