Technical Analysis – AUDCHF pivots at the 50.0% Fibonacci; tackles the 40- and 100-day MA

Anthony Charalambous, XM Investment Research Desk

AUDCHF is currently attempting to push below the coupled 40- and 100-day simple moving averages (SMAs) at 0.6755. The pair deflected off the 0.6885 resistance, which is the 50.0% Fibonacci retracement of the down leg from 0.7272 to 0.6499, before managing to reach the 200-day SMA above.

The short-term oscillators suggest strengthening negative momentum. The MACD, in the positive region, has slipped below its red trigger line. The RSI has broken below its neutral mark and is declining in the bearish territory, while the Stochastics seem to be entering the oversold area.

If sellers manage to overrun the 0.6755 support, where the 40- and 100-day SMAs reside, the pair may tumble to meet the 23.6% Fibo of 0.6681 ahead of the swing low of 0.6655 from October 1. Breaching this level could see the price drop to test the support of 0.6585 before traders’ attention turns to the support region of 0.6522 to 0.6499, with the latter being the all-time low for the pair.

In a positive scenario, the bulls initially would need to overtake the 38.2% Fibo of 0.6794 before the inside swing around 0.6850. Moving higher, the 50.0% Fibo of 0.6885 could once again challenge the bulls ahead of the nearby 200-day SMA at 0.6905. Surpassing 0.6905 could drive the price to the 0.6954 – 0.6976 area, where the swing peak and 61.8% Fibo lie.

In brief, a break below 0.6755 could turn the short-term bias bearish, with a move below 0.6655 reinforcing this negative picture. However, a break above 0.6954 would shift the bias to bullish.