Market Update: AUDUSD Are We Close To A New Break Lower?
Hi traders, today we’re taking a look at the daily AUDUSD as sellers look to be pushing at a new extension lower.
USD buyers picked up the pace late in today’s Asian session and have kept the pressure up into the London session. Their momentum was countering out stronger than expected as Australian employment data saw an increase in job creation and a decrease in the unemployment rate. Australian unemployment dropped back below 5%. Bear in mind, we haven’t seen 4.9% since March 2019.
Despite this prices continue to move lower with pressure continuing to mount on yesterday’s close higher. If we look at the daily chart below we can see the stopping point at .7480. This level is marked as key resistance. This level is important to us as its stopped buyers since the 8th of the month. Yesterday’s rally failed at this point and sellers have fed of the failed test at this level today.
The pattern of trend also favours sellers for now with a nice series of LH and LL moving down the current downtrend. What do sellers have to do now? If we are going to see a new extension lower we want to see the price break out of its current consolidation. That could show sellers remain in overall control and we would also want to see a new lower low put in. Measured move projection, that could take us back to the .7370 area. (measured move projections are guides and not set price targets)
If we see failure at the current LL or a new higher low set up this could be a warning that seller momentum may not be as strong as first thought and the market may need more time to work out which way it could move out of the current consolidation.