- Despite the recent lack of momentum, AUD/USD reversed the corrective bounce off the yearly low from the previous day.
- In the midst of an oversold RSI, a six-month-old falling trend line tests Australian bears.
- Recovery is still elusive below the resistance confluence of 0.6460; 0.6500 increases the upside filters.
Early Thursday morning in the European session, the AUD/USD pair maintained its lower position around 0.6375–70, eroding the previous day’s recovery from a 10-month low.
Nevertheless, Reserve Bank of Australia (RBA) Governor Philip Lowe’s most recent remarks as the head of Australia’s central bank seem to be weighing on the Australian pair, as do the inconsistent trade figures from Australia and China.
On the other hand, the almost oversold RSI (14) line points to a downward-sloping support line from early March, at the very least close to 0.6330, suggesting that there is little negative potential for the AUD/USD pair.
The November 2022 low of roughly 0.6272 will serve as the last line of defense for pair buyers in the event that the Australian bears disregard the RSI circumstances and breach the indicated significant support line. This will also highlight the likelihood of a decline towards the previous yearly trough of 0.6170.
In the meantime, the 21-day Exponential Moving Average (EMA) and a downward-sloping resistance line from July 13 are converging, and the AUD/USD pairs’ recovery is still not impressive below this point, at most near 0.6460.
Subsequently, a number of levels around 0.6500 that have been established since late May could test the AUD/USD bulls before allowing them to take the lead.
Even though there seems to be little potential for decline, the AUD/USD pair is still on the radar of bears overall.