AUDUSD accelerated lower on downbeat data and pressure daily cloud top; FOMC minutes eyed for fresh signals
The Australian dollar remains firmly in red and extended weakness in Asia on Wednesday, hitting one-week low at 0.7840.
Stronger US dollar continues to drive the Aussie lower, with additional pressure coming from downbeat Australian construction data which fell by 19.4% in Q4, strongly undershooting forecast for 10.1% drop and against upward-revised increase by 16.6% in Q3.
Fresh extension lower cracked support at 0.7846 (Fibo 61.8% of 0.7758/0.7988 upleg) and pressures next strong support at 0.7816 (top of rising daily cloud).
Daily techs are turning into firm bearish mode (south-heading RSI and slow stochastic, growing bearish momentum and 10/20SMA’s in bearish setup) and support further weakness.
Close below 0.7846 Fibo support will be bearish signal which needs confirmation on close below cloud top, to expose key near-term support at 0.7758 (09 Feb correction low / daily cloud base).
Broken 10SMA offers immediate resistance at 0.7848, followed by broken Fibo 38.2% barrier at 0.7900, with near-term action weighed by thick hourly cloud (spanned between 0.7911 and 0.7939).
Near-term focus is turning to the minutes of the Fed’s late January policy meeting which could provide more clues about the pace of central bank’s actions in 2018.
Hawkish tone from the minutes would increase hopes for faster interest rate hikes this year and could lift the greenback further.
Res: 0.7848; 0.7900; 0.7939; 0.7947
Sup: 0.7840; 0.7816; 0.7773; 0.7758