The Australian dollar dips to one-month low (0.7592) in European trading on Thursday, being under increased pressure from faded risk mode.
The pair fell 1.3% on Wednesday, with today’s extension lower, completing reversal pattern (bearish failure swing) and breaking initial Fibo support at 0.7624 (23.6% of 0.6991/0.7820). Profit-taking from new 10-month high (0.7820) contributed to fresh weakness, with January’s action on track to close in red after two months of strong gains.
Monthly candle also has long upper shadow that indicates strong offers under falling 100MMA (0.7881) and additionally weighs.
Rising negative momentum and daily MA’s (10,20,30) in bearish setup, support near-term bears.
Close below 0.7624 Fibo support would expose targets at 0.7542 (55DMA) and 0.7503/0.7498 (Fibo 38.2% of 0.6991/0.7820/top of rising daily cloud).
Broken 30DMA (0.7680) reverted to solid resistance which needs to hold and maintain bearish near-term bias.
Res: 0.7624, 0.7680, 0.7701, 0.7722
Sup: 0.7592, 0.7542, 0.7503, 0.7461