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Summary: On Friday, the AUDUSD lost 0.61% intraday, continuing to face selling pressure and trading defensively around the 0.6670 level.

Fundamentals

In Thursday's trading, the AUDUSD showed strong bearish momentum after falling below the 0.6684 level. This breach of the upward support line suggests a potential continuation of the bearish trend.

One possible scenario is a further decline towards the first support level at 0.6655, which is identified as a retracement support closely related to the 78.60% Fibonacci retracement level. If the bearish trend persists, the second support level at 0.6598 represents another significant area, acting as an overlapping support level.

However, on the positive side, if more corrective movements occur, the first resistance level at 0.6716 becomes a critical level to watch, as it also serves as an overlapping resistance level. Additionally, the second resistance level at 0.6736 marks another important area, acting as an overlapping resistance level.

Technical Analysis

After yesterday's selling pressure, the AUDUSD failed to stabilize around the 0.6735 level and its 20-day and 200-day SMAs, leading to a significant reversal and increasing pessimism among investors, raising concerns about further selling of this asset.

From a technical perspective, the relative strength index (RSI) dropped below the 50-neutral level, indicating that while the currency pair may recover some lost ground in the short term, it is likely to continue its downward trend thereafter. Similarly, the stochastic oscillator has shifted from an upward trajectory, suggesting a favorable outlook for further downside movement.

In the 4-hour chart, technical indicators show a downward bias, but the currency pair has not entered oversold territory yet. The price is below key moving averages and testing below the 0.6720 level. The next area of interest lies at 0.6600, below which the next support level is at 0.6560. While on the upside, immediate resistance is at 0.6716, followed by 0.6736. A move above the latter would alleviate bearish pressure.

Overall, the AUDUSD may experience some corrective rebounds in the short term, but whether it can sustainably break above the 0.6720 resistance level remains to be observed. In terms of trading, going short at highs is recommended.

Trading Recommendations

Trading Direction: Short

Entry Price: 0.6720

Target Price: 0.6518

Stop Loss: 0.6845

Valid Until: 2023-08-11 23:55:00

Support: 0.6700, 0.6652, 0.6594

Resistance: 0.6720,0.6823, 0.6845