AUDUSD – bears take a breather on US-China talks, but strong bearish bias remains while 10SMA stays intact
The Aussie dollar trades in recovery mode on Monday and is firmly above 0.77 handle, supported by news about US-China talks, which aim to improve current situation and prevent trade war.
Positive results of talks could result in further recovery.
However, techs remain firmly bearish and keep the downside at risk, which could intensify if recovery stalls under initial barrier at 0.7752 (falling 10SMA).
Daily MA’s are in firm bearish setup and formed multiple bear-crosses, marking a cluster of barriers between 0.7775 and 0.7810, reinforced by thick daily cloud base at 0.7817 and weighing heavily on near-term action. Additional pressure is coming from negative momentum studies (14-d momentum is heading south, deeply in negative territory).
Unless stronger fundamentals boost the pair and sideline immediate bearish risk on lift above 10SMA, the pair may hold in extended but limited consolidation, before broader bears continue towards target at 0.7641 (weekly cloud base).
Res: 0.7752; 0.7775; 0.7809; 0.7817
Sup: 0.7695; 0.7686; 0.7672; 0.7641