AUD/USD drops sharply after being rejected at 0.6900 resistance!
Do we look at the reflection?
Or are the Australian dollar bulls taking a break?
AUD/USD for one hour Planned by TV
As you can see, there were enough bears at the psychological handle of 0.6900 to prevent the AUD/USD bulls from extending a sharp bullish wave in July.
The pair is now trading just above .6800, which is near the 38.2% Fibonacci retracement and the pivot point level (6780.) on the one-hour time frame.
Are we looking to back off? Or is AUD/USD ready for a reversal?
Looking at how markets have responded to weak US inflation and the slightly weaker Chinese data being dumped, it appears that markets are happy to price in “peak inflation” and “peak interest rates” from the major economies and their central banks.
However, this week’s data may affect the depth of the bearish decline in the AUD/USD pair before it sees enough buying pressure.
Growth fears may gain traction if this week’s US retail sales data and earnings paint a picture of weak growth trends.
Meanwhile, the RBA meeting minutes and Australian jobs data may underscore the need for the RBA to pause rate hikes.
If today’s dovish mood, RBA meeting minutes and US retail sales releases weigh on risk assets like AUD, AUD/USD will drop not only to 0.6800 pivot point but also to 0.6750 or even trend line support. 6700 district.
But if this week’s catalysts extend into last week’s risk-friendly mood, AUD/USD could extend its upside without visiting the pullback areas we identified.
what do you think? How low can AUD/USD go before seeing extended buying pressure?
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