AUDUSD – extended recovery faces strong resistances at 0.7890/0.7910 zone
The Australian dollar extends bounce from 0.7758 low (09 Feb) where steep descend from 0.8135 faced strong headwinds from supports provided by 200SMA and rising daily cloud.
Recovery extends into third day but shows signs of losing traction ahead of strong barriers at 0.7892 (falling 10SMA) and 0.7902 (Fibo 38.2% of 0.8135/0.7758 fall).
Fundamentals are supportive for AUD, following release of stronger than expected Australian business confidence (12 in Jan vs 10 f/c and 11 previous month).
On the other side, techs are mixed, slow stochastic heads north on daily chart; RSI turned sideways and holding under neutrality zone, while bearish momentum is building.
Bulls need sustained break above pivotal 0.7890/0.7910 resistance zone to generate fresh bullish signal for recovery extension towards 0.7963 (20SMA) and psychological 0.80 barrier (also near Fibo 61.8% of 0.8135/0.7758 descend.
Conversely, the downside is expected to remain vulnerable while the price holds below plethora of resistances between 0.7890 and 0.7910.
Rising 55SMA marks initial pivotal support at 0.7802, loss of which would re-expose 200SMA.
Res: 0.7892; 0.7902; 0.7910; 0.7935
Sup: 0.7847; 0.7802; 0.7771; 0.7754