The Australian dollar holds in red in early European trading on Tuesday and pressures 0.71 support, hit by RBA minutes, released in Asia.
The central bank pointed in significant uncertainties on the economic outlook, mainly due to strong fall in housing market that would sideline expectations for change in interest rates in the near-future.
Strong upside rejection on Monday resulted in daily Doji with long upper shadow which could be initial signal of recovery stall.
Corrective advance from 0.7054 base lost traction at strong resistance zone (0.7148/57), provided by a cluster of converged daily MA’s and subsequent dip so far retraced 50% of 0.7054/0.7160 recovery leg, increasing risk of further weakness.
Rising bearish momentum on daily chart supports scenario, with extension and close below falling 10SMA (0.7101) to risk return to 0.7054 base. Daily cloud twists on Thursday and could also attract bears.
Res: 0.7119, 0.7143, 0.7160, 0.7174
Sup: 0.7101, 0.7094, 0.7079, 0.7054
