The AUDUSD is under pressure today as sellers have come out in force, driving the pair back below the key 0.7646 handle on an intraday basis. This level is the June high and also assisted in capping the advance in mid-July.
Buyers managed to overtake the level on August 9th but subsequently failed to push prices convincingly higher. As a result, the bulls have looked tepid all week, barely managing to keep the pair afloat.
But that may be about to change.
As is always the case when trading the daily time frame, a daily close is needed to confirm the break. Such patience is of particular importance on Fridays when many institutions begin unwinding positions in preparation for the weekend.
So, a daily (and weekly) close below 0.7646 would indicate weakness and open the door for a move lower next week.
How low?
One support level I’m keeping an eye on is 0.7500. This area acted as a pivot between June 9th and August 2nd and was also the technical catalyst for two rallies in March and April.
A move below 0.7500 would bring ascending channel support back into focus, a level that extends from the current 2016 low. On the flip side, a daily close back above 0.7646 would negate the bearish bias and expose the current August high at 0.7760.
Event risk for the Aussie looks relatively light next week. However, there are several US-centric events including durable goods orders and unemployment claims on Wednesday followed by prelim GDP and a speech by Janet Yellen on Friday.
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