**AUD/USD Price Forecast: Bearish Momentum Gains Strength**
*Based on content originally by Christian Borjon Valencia, FXStreet, with additional insights.*
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**Introduction**
The Australian dollar against the US dollar (AUD/USD) has recently experienced heightened bearish momentum. The currency pair has been pressured lower, as key technical levels are breached and market participants respond to fundamental economic factors. This downturn in the AUD/USD reflects a combination of global risk sentiment, evolving monetary policy expectations, and significant macroeconomic developments. In this analysis, we explore the recent price action, technical picture, fundamental drivers, and the outlook for the pair.
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**Recent Price Action**
The AUD/USD pair has been on a downward trajectory as sellers assert control. Recent sessions have seen intensified selling pressure, with the pair giving up previous gains and breaking below important support zones. The current move to the downside follows several failed attempts to reclaim higher ground, suggesting a change in market sentiment.
– The exchange rate has fallen below key short- and medium-term moving averages.
– Selling pressure increased following breaks below both psychological and historical support areas.
– Intraday moves indicate persistent bearish sentiment, with each attempt at recovery met by renewed supply.
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**Technical Analysis**
The bearish case for AUD/USD is reinforced by several technical factors. These include momentum indicators, trendlines, chart patterns, and moving averages, all aligning to suggest that sellers have the upper hand.
**1. Moving Averages**
– The pair has traded below the 50-period and 200-period simple moving averages (SMAs) on both the 4-hour and daily charts, indicating established downtrends.
– Crossovers to the downside have strengthened the bearish outlook and are attracting technical sellers.
**2. Support and Resistance Levels**
– Recent declines have breached the 0.6600 psychological level as well as support at 0.6570, opening the door for further losses.
– The next significant support zones are found at 0.6520 and near the 0.6500-0.6460 range. These levels coincide with previous reaction lows and consolidation areas.
– On the upside, resistance is located at 0.6600 and 0.6650, where sellers previously defended territory and buyers failed to regain control.
**3. Momentum Indicators**
– The Relative Strength Index (RSI) entered oversold territory on lower timeframes, reflecting strong bearish momentum, though not yet confirming long-term exhaustion.
– The Moving Average Convergence Divergence (MACD) indicator has crossed bearish, reinforcing early signals of downward continuation.
**4. Trendlines and Patterns**
– The pair broke below a crucial ascending trendline that had provided support for much of June.
– The breakdown is consistent with a reversal pattern, with the recent price action forming a head-and-shoulders structure. The violation of the neckline supports bearish technical projections.
– Bearish flags and pennants on lower timeframes have resolved to the downside, confirming near-term bias.
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