AUDUSD fails to extend the previous day’s corrective bounce off the two-year low as a 12-day-old resistance line joins the 61.8% Fibonacci Expansion (FE) of April-August moves, around 0.6530, to recall the bears. The nearly oversold RSI conditions, however, challenge the pullback moves, which in turn suggest limited downside and highlight the 78.6% FE level near 0.6365. In a case where the pair declines below 0.6365, the 0.6300 and the 0.6200 thresholds may please the bears before directing them to the 100% FE level near 0.6150.
Alternatively, recovery moves must stay successfully beyond the 0.6530 resistance confluence to aim for the 2.5-month-old hurdle, around 0.6680-85. Following that, the monthly high near 0.6915 and a downward sloping resistance line from early June, close to 0.7020, will be in focus.
Overall, AUDUSD is up for further downside but the room to the south appears limited.
Alternatively, recovery moves must stay successfully beyond the 0.6530 resistance confluence to aim for the 2.5-month-old hurdle, around 0.6680-85. Following that, the monthly high near 0.6915 and a downward sloping resistance line from early June, close to 0.7020, will be in focus.
Overall, AUDUSD is up for further downside but the room to the south appears limited.