USD Price Analysis: Sellers continue to lurk around 0.7400 amid covid concerns
- AUD/USD turns south after facing rejection at the 200-HMA.
- Bulls now defend the 21-HMA, as RSI holds above 50.00
- Escalating covid concerns cap the upside in the aussie.
AUD/USD is holding onto minor gains, having quickly retraced from four-day highs of 0.7402 reached in early Asia.
Sellers continue to lurk around 0.7400, capping the two-day recovery rally from eight-month lows of 0.7288, as Australia sees no reprieve from the escalating coronavirus concerns, as the optimism over falling cases in Victoria is offset by the news of the extended lockdown in New South Wales well past the July-end timeline.
Looking at the aussie on the hourly technical graph, the bulls failed to chew the offers at the 200-Hourly Moving Average (HMA) at 0.7402 earlier on, knocking off the rates towards the 21-HMA support at 0.7379, where it now wavers.
An hourly close below the latter could trigger a sharp drop towards the upward-sloping 50-HMA at 0.7355.
Further south, the July 22 low of 0.7341 will offer some support to the bullish traders.
AUD/USD: Hourly chart
The Relative Strength Index (RSI) has edged lower but remains well above the midline, suggesting that the upside still remains on the cards.
Acceptance above the 200-HMA is needed to extend the recovery momentum towards the 0.7450 – psychological level.