AUD/USD to challenge key support at 0.7418 – Credit Suisse

AUD/USD recovered slightly on Monday, but remains capped below the 200-day average at 0.7557 – let alone the “neckline” to the large top at 0.7587. Analysts at Credit Suisse look for a renewed turn back lower.

Close back above 0.7623 would neutralise the bearish view

“The aussie maintains its weekly close below the key band of support including the 200-day average at 0.7555/31. This completed a major top to reverse us into a medium term bearish view, with the next initial support seen at 0.7477/61, below which would complete a fresh intraday bearish continuation pattern to open up the 23.6% retracement of the entire upmove from 2020 at 0.7418 next. It’s worth noting that there is a dearth of meaningful support below here, with the “measured top objective” seen all the way down at 0.7085/43.” 

“First short-term resistance moves to the breakdown point at 0.7547/62. Above here would trigger a small intraday base to suggest a corrective move back higher, with the next level at 0.7587/92, then at most 0.7622/ 23, where we’d look for a cap.”