4-hr AUD/USD: A Pullback Is Taking Place
The AUD/USD pair remains entrenched in a clear downtrend, reflecting ongoing bearish market sentiment. This trend was reinforced by the emergence of a strong sell signal, known as the Death Cross, where the 20-period moving average (MA) crossed below the 60-period moving average. This technical event typically signals continued downside potential in the currency pair.
Despite the prevailing downtrend, the pair is currently experiencing a pullback. This retracement has been driven by short-term buyers stepping in, attracted by the oversold conditions and the potential for a brief recovery. As a result, the AUD/USD has climbed back above the 23% Fibonacci retracement level, suggesting some temporary stabilization.
The pair now appears poised to retest the 0.6560 region, which aligns closely with the 50% Fibonacci retracement level. This area is likely to act as a potential resistance point, offering traders an attractive entry opportunity to sell and align with the dominant bearish trend. For sellers, this level represents a better risk-to-reward setup, allowing them to capitalize on the broader downtrend while minimizing exposure to short-term fluctuations.
Despite the prevailing downtrend, the pair is currently experiencing a pullback. This retracement has been driven by short-term buyers stepping in, attracted by the oversold conditions and the potential for a brief recovery. As a result, the AUD/USD has climbed back above the 23% Fibonacci retracement level, suggesting some temporary stabilization.
The pair now appears poised to retest the 0.6560 region, which aligns closely with the 50% Fibonacci retracement level. This area is likely to act as a potential resistance point, offering traders an attractive entry opportunity to sell and align with the dominant bearish trend. For sellers, this level represents a better risk-to-reward setup, allowing them to capitalize on the broader downtrend while minimizing exposure to short-term fluctuations.
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