The Australian dollar bounces on Monday after pullback from 0.8135 peak which accelerated on Friday, found footstep at 0.7892 (Fibo 38.2% of 0.7500/0.8135, 11 Dec/26 Jan rally). Near-term sentiment was boosted by upbeat Chinese Caixin services PMI which was released overnight and hit the highest since May 2012. However, limited corrective action is expected as Friday’s daily long red candle weighs along with strong bearish signal that developed on weekly chart after strong bearish weekly close which came after seven consecutive bullish weeks. Broken daily Kijun-sen marks initial barrier at 0.7960, followed by broken 20SMA/Fibo 38.2% of 0.8135/0.7892 pullback at 0.7984, with extended upticks expected to hold below psychological 0.80 barrier, before fresh push lower. Break below 0.7892 pivot could trigger fresh bearish extension towards 0.78 zone (09/10Jan trough). Conversely, stronger recovery through 0.80 barrier needs to regain broken 10SMA (0.8032) to neutralize bearish threats.
Res: 0.7960; 0.7984; 0.8000; 0.8032
Sup: 0.7892; 0.7847; 0.7817; 0.7800
. Near-term sentiment was boosted by upbeat Chinese Caixin services PMI which was released overnight and hit the highest since May 2012. However, limited corrective action is expected as Friday's daily long red candle weighs along with strong bearish signal that developed on weekly chart after strong bearish weekly close which came after seven consecutive bullish weeks. Broken daily Kijun-sen marks initial barrier at 0.7960, followed by broken 20SMA/Fibo 38.2% of 0.8135/0.7892 pullback at 0.7984, with extended upticks expected to hold below psychological 0.80 barrier, before fresh push lower. Break below 0.7892 pivot could trigger fresh bearish extension towards 0.78 zone (09/10Jan trough). Conversely, stronger recovery through 0.80 barrier needs to regain broken 10SMA (0.8032) to neutralize bearish threats.){kind=link}