Bears hesitate at key 0.70 zone ahead of expected dovish RBA
The Australian dollar edged higher in Europe on Monday after overnight’s action cracked psychological 0.70 support and hit the lowest since 20 July at 0.6991.
Aussie was down 1.5% last week, driven by global risk aversion on new lockdowns and mounting uncertainty over Us Presidential Election.
Expectations that the RBA will further ease its policy on the meeting on Tuesday, adds to negative tone, however bears face strong headwinds from 0.70 support zone.
Repeated rejections at 0.70 zone and oversold daily stochastic suggest bears may take a breather before final break lower, with limited upticks under falling 10 DMA (0.7078) to precede.
Eventual break of 0.70 pivot would open way for deeper correction of 0.5509/0.7413 (Mar-Sep recovery rally and risk dip towards 0.6776 (15 June trough) and 0.6686 (Fibo 38.2%) in extension.
Res: 0.7050; 0.7078; 0.7110; 0.7158
Sup: 0.6991; 0.6964; 0.6945; 0.6891