AUD/USD downside break beckons as sellers continue to defend 100-day moving average

Technical Analysis

Author: Justin Low | audusd

Sellers remain in control of the pair this week

Call it a timely coincidence but the negative shift in risk sentiment today couldn't come at a better time for AUD/USD sellers. Price has been knocking on the door of the 100-day MA (red line) over the past three days but ultimately, buyers appear to have encountered failure to break above that - barring any miraculous turnaround in risk sentiment later in the day.

Price is now heading back towards a test of the December low @ 0.7172 but more importantly the technical support from the 13 November low @ 0.7164. A break below the latter will see price extend a move back downwards towards 0.7100 and possibly the year's lows once again.

Right now, sellers are in control on both the daily and hourly charts, and with fundamentals also supportive of a move lower today i.e. risk-off sentiment, this could be the needed push for sellers to drive a break to the downside. Again, for that to happen watch out for the 13 November low @ 0.7164.

As for buyers, it's all about getting back above the 100-day MA @ 0.7227 in order to get a reprieve from the recent downside pressure.

The key risk event for the pair later today will be the US November retail sales data, but that aside, it's all about risk sentiment as we close out the week.

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