AUD/USD: bears awaiting fresh legs from the dollar bulls, target 0.7570
- AUD/USD: leaning with a bearish bias.
- Greenback remains underwater, but a bounce could see a fresh breakout.
AUD/USD has been carving out a bearish case since losing the 0.77 handle at the start of November, but the dollar is struggling to maintain momentum. We have seen a break below the 94 handle in the DXY on Tuesday while markets tire of waiting for positive news in respect to the tax reform plans that are to be voted on in a full House this Thursday. Currently, AUD/USD is trading at 0.7634, up 0.11% on the day, having posted a daily high at 0.7651 and low at 0.7609. There is a host of other events this week for the pair that includes Aussie jobs and US retail sales / CPI.
AUD/USD's choppy price action
The Aussie found support overnight after meeting a four-month low at 0.7609 following a stellar NAB August business conditions survey result. However, 0.7639 the high capped before Chinese data disappointed. The European session made for a 0.7649 high in late London before supply took the pair back to 0.7612 where bids were attracted for a drift towards the 21 hourly SMA at 0.7629.
Valeria Bednarik, chief analyst at FXStreet explained that the dominant bearish trend remains in place considering price's behavior, and technical readings in the 4 hours chart support it the pair remains below a bearish 20 SMA, while technical indicators hover within negative territory, lacking directional strength as the pair remains within its latest range. "The immediate support is now the 0.7610 level, with a break below it favoring a test of 0.7570, where the pair has a couple of daily lows from early July, followed later by 0.7535," Valeria added.