- AUDNZD witnessed an intraday turnaround from a multi-week-old descending channel resistance.
- The set-up has shifted back in favour bearish traders and supports prospects for further weakness.
- The pair now seems vulnerable to break below the 1.0700 handle and test trend-channel support.
- Fresh bearish positions should be accompanied by appropriate stop-loss near the 1.0825-30 area.
AUDNZD faced rejection near the top end of a multi-week-old descending trend-channel, which points to a well-established short-term bearish trend. The pair's inability to make it through a key barrier and the subsequent fall of around 70 pips might have again shifted the near-term bias back in favour of bearish trades.
The outlook is further reinforced by the fact that technical indicators on the daily chart maintained their bearish bias and have again started drifting into the negative territory on hourly charts. Hence, some follow-through selling below a horizontal support near mid-1.0700s will set the stage for additional weakness.
The pair now seems vulnerable to slide further towards challenging the trend-channel support, currently near the 1.0680 region. Intermediate support levels are pegged near last week's swing low, around the 1.0720-15 region, and the 1.0700 handle.
On the flip side, the 1.0800 mark now seems to act as an immediate resistance and is closely followed by the trend-channel barrier, around the 1.0825-30 region. A convincing breakthrough will negate any near-term bearish bias and hence, should act as a stop-loss level of fresh bearish positions.