AUD/USD is a little higher today but struggles to stay above 0.6700
The pair is trading a little higher at the moment, recovering some ground after hitting its lowest levels since 2009 on Friday last week. The calmer mood in the Chinese yuan as well as talk of exporter bids are said to be underpinning the aussie today.
However, gains remain limited as we see price action capped around the 0.6700 level against the dollar. Looking at the near-term chart:
Sellers continue to stay in near-term control with the 0.6700 level and the 38.2 retracement level just above that helping to limit gains so far today.
The risk for sellers can be defined and limited by the levels above as well as the key hourly moving averages, sitting closer at 0.6718-23 currently.
As long as price action keeps below that, AUD/USD remains vulnerable to a potential downside push firmly below the key daily support levels at 0.6670-90.
A break below that will see little in the way of a move towards 0.6600 and even 0.6500 – depending on market sentiment and prevailing headlines at the time.
Looking ahead, the risk mood will be arguably the key factor in driving trading sentiment in the pair this week; although be wary of a potentially more powerful short squeeze on better risk headlines considering the stretched technical picture at the moment.