The US dollar continues to maintain a strong stance even as we approach the US presidential election. This has significantly limited upside retracement in the AUDUSD market. Furthermore, the market seems to have resumed its downward trajectory, going by the way price activity ended on Friday of the previous week. Let’s try to understand or determine the direction of price movement in the new week.
Key Price Levels:
Resistance Levels: 0.6600, 0.6650, 0.6700
Support Levels: 0.6500, 0.6450, 0.6400
AUDUSD Erases Previous Minimal Gains
AUDUSD appears to have hit a strong base level around the 0.6544 price mark. For the past three sessions, price action has been consolidating sideways above the price level. The past two sessions have produced minimal upside price movements as dictated by the strong sentiment surrounding the US dollar.
However, the closing session seems to have produced a stronger downward retracement that erased the minimal gains recorded over the past two sessions. Meanwhile, price action remains below the 20, 50, 100, and 200-day Moving Average (MA) lines. The appearance of the last price candle on the chart suggests that the market may have resumed a downward trajectory. Be that as it may, the Stochastic Relative Strength Index (Stochastic RSI) lines can still be seen as having an upward trajectory.
AUDUSD Market Seems Poised to Break the 0.6545 Support Level
The AUDUSD market retains a bearish outlook coming from the daily chart to the 4-hour chart. The last price candle here also suggests that price activity may have resumed a downward path. Through the aid of the last price candle, we can see that the pair’s price is now below all the MA lines. Similarly, the Stochastic RSI lines have delivered a bearish crossover in the overbought region, and the indicator lines have started a downward course.
The movement of the leading line of the RSI suggests that volatility is significant. As a result, this threatens the support at the 0.6545 level. Tomorrow (Monday) does hold a considerable amount of minor economic data on both sides. Traders may want to gather some impetus from those data. But, considering available indications, it does seem that price activity may approach the 0.6500 threshold.
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