At $0.6909 and $0.7042 levels on daily and monthly plotting respectively.
Consequently, these patterns plummet prices below DMAs,
For now, more slumps seem to be likely upon breach below strong supports of 0.6963 levels, while both leading and lagging indicators substantiate these indications (refer daily plotting).
In addition to that, this is coupled with a broader perspective as well: The major trend of this pair has been extending formation with breach below neckline and heading towards 3 and a half years lows (refer monthly plotting), candle followed by patterns plummet prices well below 7EMA again on this timeframe. Attempts of upswings are restrained below 21-EMA levels.
Both and curves have signaled faded strength and intensified momentum as these leading oscillators show downward convergence to the prevailing price dips.
While and crossovers substantiate the sentiments indicating the prevailing downtrend to prolong further. Overall, we could foresee no traces of recovery as the Aussie goes vulnerable on fundamental grounds as well.
Trade tips: On trading perspective, at spot reference: 0.6890 levels, contemplating above technical rationale, it is advisable to execute one touch put options strategy with lower strikes at 0.6827 levels, thereby, one can achieve certain yields as long as the underlying spot FX keeps dipping on the expiration.
Alternatively, on hedging grounds, we advocate shorting contracts of mid-month tenors as the underlying spot FX likely to target southwards below 0.67 levels in the medium run. Writers in a contract are expected to maintain margins in order to open and maintain a short position.
Currency Strength Index: FxWirePro's hourly AUD spot index is inching towards -58 levels (which is ), while hourly USD spot index was at 74 ( ) while articulating (at 05:40 GMT ). These indices are also conducive for the above short set-up.