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AUD/USD at the edge of the cliff

FXStreet (Guatemala) - AUD/USD is trading at 0.8658, down -1.64% on the day, having posted a daily high at 0.8808 and low at 0.8647.

AUD/USD is consolidating the fierce movement in the greenback from Friday’s Non farm payrolls surprise to the upside and now balances on a tightrope ahead of critical support at 0.8660. Technically the pair is in oversold territory yet comes with a bearish bias. " The 1 hour chart shows a strongly bearish 20 SMA standing above current price and indicators in oversold territory, while the 4 hours chart shows indicators heading lower below their midlines, and 20 SMA slowly gaining some bearish slope, suggesting the pair is breaking previous days’ range to the downside", explained Valeria Bednarik, chief analyst at FXStreet.

AUD/USD fundamentals

The play here along the fundamentals will take into consideration the yield that the Aussie carries but with that in mind it begs the question as to whether investors are seeking for safer havens over yield advantages at the moment. In any case, there maybe some profit taking due out of the greenback that could be supporting the pair ahead of a decent towards levels not seen since 2010. Looking ahead, we have the RBA coming up in the week where analysts don’t expect any changes from the central bank for the time being, although this would be the main focus until the FOMC minutes and the Australian employment rate arriving later on in the week.

AUD/USD noteworthy levels

Spot is presently trading at 0.8659, and next resistance can be seen at 0.8679 (Daily Classic S2) and 0.8698 (Previous YTD Low). Support below can be found at 0.8635 (Daily Classic S3), 0.8619 (Weekly Classic S2), 0.8489 (Weekly Classic S3) 0.8320 (July 2010 low) and 0.8104 (5 Year Low).

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