Aussie dips to one-week low as US/China tensions sour risk sentiment
The Australian dollar extends weakness into third day and hits one-week low at 0.6372 in early Monday’s trading, as risk sentiment soured on renewed tensions between the US and China.
Fresh bearish extension on Monday was so far contained by rising 20DMA (0.6372), with break here to spark deeper correction of 0.5509/0.6569 rally.
Momentum is breaking into negative territory on daily chart and stochastic heading south, adding to negative tone, with break of 20DMA to risk fall towards pivotal supports at 0.6210 (daily cloud top) and 0.6164 (Fibo 38.2% of 0.5509/0.6569 ascend).
Broken 10DMA (0.6420) caps today’s action for now, with break and close above to ease bearish pressure.
Markets focus on Tuesday’s RBA policy meeting, with polls indicating that the central bank will stay on hold this time and keep interest rates at all-time low (0.25%).
Res: 0.6420; 0.6476; 0.6510; 0.6554
Sup: 0.6372; 0.6323; 0.6253; 0.6210