The Australian dollar was sharply lower on Friday, pressured by weaker than expected China’s IP and retail sales data that pressured riskier assets. Fresh bears reversed recovery rally of past four days (0.7177/0.7246) and broke below thinning daily cloud which twists on Monday and pivotal Fibo support at 0.7163 (Fibo 61.8% of 0.7020/0.7393) in extension. Near-term structure weakened after today’s fall as momentum moved into negative territory and daily MA’s turned into negative setup. Today’s close below 0.7163 pivot would add to negative outlook for extension of pullback from 0.7393 (04 Dec recovery high) towards next support at 0.7108 (Fibo 76.4%). The pair is on track for the second consecutive bearish weekly close, after last week’s weekly bearish engulfing pattern generated strong bearish signal. Broken former low at 0.7177 and 55SMA at 0.7185, mark initial resistances, with stronger upticks expected to remain below falling 100SMA (0.7224) which limited recent recovery.
Res: 0.7177, 0.7185, 0.7224, 0.7239
Sup: 0.7153, 0.7108, 0.7074, 0.7050
