AUD/USD has rebounded in the short-term but the bullish movement seems over after the rate has printed a double top pattern signaling another bearish momentum. The pair will drop deeper if the dollar index will jump higher after its most recent retreat.
The Aussie lost altitude after the RBA, even though the Cash Rate was kept steady at 0.25%, for now, signaling more stimulus measures in the next meeting. Fundamentally, AUD/USD could drop ahead of the upcoming monetary meeting.
AUD/USD has come back to test and retest the uptrend line before going down. It has developed a Double Top right on the uptrend line signaling a down reversal. The price is testing the PP (0.7132) level, a new lower low, drop, below 0.7095 today's low represents a bearish signal.
The short-term bias remains bearish as long as the rate stays below the downtrend line. We'll have a broader corrective phase if the pair takes out the static support from 0.7000 psychological level.
- AUD/USD Trading Tips
You can go long only if the price makes a valid breakout above the black downtrend line. Though, this scenario is less likely to take shape soon.
Sell a drop below 0.7095 or below 0.7000 levels. The S3 (0.6875) could be used as a downside target.