Extended recovery on fresh risk appetite needs confirmation on close above 10DMA
The Australian dollar extends recovery from new multi-month low on Tuesday and cracked pivotal barriers at 0.6708/13 (converged falling 5/10DMA’s), driven by fresh risk appetite on signs of virus spreading slowdown.
Daily RSI and momentum head north after forming bullish divergence which could help recovery.
Extension and close above 10DMA would generate firmer bullish signal and open barrier at 0.6749 (Fibo 23.6% of 0.7032/0.6662), with key levels at 0.6775/0.6803 (5 Feb lower top, reinforced by falling 20DMA / Fibo 38.2% of 0.7032/0.6662).
Caution on failure to clear 10DMA that would keep the downside at risk.
Res: 0.6713; 0.6749; 0.6775; 0.6803
Sup: 0.6681; 0.6662; 0.6643; 0.6600