AUD/USD technical analysis: 0.6823/20 becomes a tough nut to crack for sellers

• AUD/USD drops to one week low.
• Multiple highs marked during early-August, 21-day EMA can question further declines.

Following Doji candle on the daily chart, the AUD/USD pair drops to one week low, before recovering to 0.6840, ahead of Tuesday’s European session.

Although downward sloping curve of 14-bar relative strength index (RSI) favors the pair’s further declines, 0.6823/20 comprising early-August highs and 21-day exponential moving average (EMA) could challenge the sellers.

In a case where prices slip beneath 0.6820, 23.6% Fibonacci retracement of April-August south-run near 0.6800 and 0.6735 level that signifies lows marked on August 14 and 23 cam lure bears.

On the upside, a sustained break above 100-day EMA level of 0.6900, also a northside validation by July 10 low of 0.6910, becomes necessary for the bulls to target 0.7000/ confluence encompassing a downward-sloping trend-line since April and 61.8% Fibonacci retracement level.

AUD/USD daily chart

Trend: pullback expected