AUD/USD drops further, hits 2-week lows

AUD/USD continued to decline during the American session. The last leg lower followed a sharp slide of the Canadian dollar across the board after a member of the Bank of Canada warned about the strength of the Loonie. 

AUD/USD again rejected at 0.8035

During the Asian session, the pair tested again the 0.8030 zone, a relevant short-term resistance but it failed to break higher and turned to the downside. Since then it has been moving with a bearish bias, falling constantly.

The pair bottomed at 0.7939, the lowest since September 5. Near the end of the day, it was hovering around 0.7950, down 45 pips from Friday’s close and below last week lows. 

AUD/USD Technical outlook 

“The 4 hours chart shows that the pair may continue sliding over the upcoming sessions, as the decline gained momentum once the price broke below its 20 SMA, bearish around 0.7995, whilst in the same chart, the RSI indicator maintains a strong downward momentum around 35, while the Momentum holds within negative territory, with limited directional strength”, said Valeria Bednarik, Chief Analyst at FXStreet. 

According to her, around 0.7920 there is a strong static support around 0.7920 and a break lower would favor a downward continuation.