The AUD/USD continues to struggle to gain acceptance over the 50-day SMA and it seems like it is taking a breather after five days of gains. The pair’s recovery from the multi-year low came to a halt near the 50% Fibo levels (0.7082-0.6677) and moved lower on Tuesday.
The slightly overbought conditions on the 4-hour chart appear to be the only factor that speaks in favor of profit-taking. The oscillators remain bullish on the daily chart and so setbacks can be used as a buying opportunity in the midst of increasing US-China trade optimism.
Therefore, it would be advisable to wait for a drop below the previous resistance breakpoint near the 0.6800, which is now supported, before positioning yourself for further losses.
A sustained move above 0.6875/80 (50% Fibo levels) should signal an upward move above 0.6900 and so the 61.8% Fibo Retracement of 0.6925.