AUDCHF Chart Technical Outlook should return above 0.5720 to ease bearish pressure
The Australian Dollar is trimming losses on Thursday, favored by somewhat better-than-expected Chinese trade data, and the hawkish comments by RBA Governor Lowe, who left the door open to further monetary tightening if inflation remains sticky.
That said, the market sentiment is negative, and investors’ concerns about China, a key Australian partner are far from solved as the Authorities seem reluctant to approve the strong stimulus measures the market is looking for.
In this context, we expect the Aussie to remain vulnerable with the confluence of the 4h 200 SMA and reverse trendline, at 0.5713 likely to offer a significant resistance ahead of the 0.5750/70 area.
If that scenario materializes, we could see a further decline toward the target of the broken flag pattern, at 0.5610. Below here, the next support is at the 0.5600 round level.
