A Rejection at Fibonacci Resistance Could Extend the AUDUSD Decline

Summary:

If this bearish crossover takes place, both oscillators would point in the same direction, reinforcing the downside scenario.

Sell AUDUSD

EXP

Trading

0.69958

ENTRY

0.69210

TGT

0.70900

0.69946 -0.00022 -0.03%

Point

Flat

0.69210

TGT

CLOSING

0.69958

ENTRY

0.70900

Iranian Foreign Minister Abbas Araghchi stated that consultations through Qatari and Pakistani mediators had become "very intensive," adding that Tehran had presented its conditions and proposal, while further progress would depend on Washington's "political rationality." He also emphasized that the reopening of the Strait of Hormuz remained conditional on the US accepting Iran's demands, including ending its naval blockade and lifting sanctions. Oil prices fell by more than 4% on Monday as traders reacted to encouraging diplomatic developments in the Middle East, raising hopes that tensions in the region could ease.

The Federal Reserve voted 10-2 to keep interest rates unchanged within the 3.75%–4.00% range in October, following the 25-basis-point (bps) increase in September. The decision reflects a more patient approach as policymakers continue to assess inflation developments and the broader economic outlook. According to CME FedWatch, traders currently assign a 72% probability to another interest rate increase in December.

Meanwhile, the US ISM Manufacturing Purchasing Managers' Index (PMI) increased to 55.5 in October from 54.5 in the previous month, exceeding market expectations of 54.6. On the other hand, the Prices Paid Index moderated to 75.2 from 77.9, coming in below the forecast of 77 and indicating some easing in manufacturing input cost pressures.

In Australia, the S&P Global Manufacturing Purchasing Managers' Index (PMI) showed a further contraction in October, declining to 49.6 compared with market expectations of an unchanged reading at 49.7. However, construction activity provided a more positive signal, as building permits rebounded by 5.1% in September, well above the 2.1% expected by the market and reversing the 5.2% decline recorded in August.

The Reserve Bank of Australia (RBA) is widely expected to raise interest rates by 25 basis points (bps), which would represent its fifth increase this year and bring the cash rate to 4.85%, its highest level since 2008. This expected adjustment reflects the central bank's continued concerns over persistent inflationary pressures and the need to bring price growth back toward its target range.

Inflation remains above the RBA's target range of 2%–3%, with headline CPI accelerating to 4.3% year over year in September from 4.0% in August. Annual trimmed mean inflation also increased to 3.6% from a revised 3.5%, indicating that underlying price pressures remain elevated despite the central bank's previous tightening measures. A Rejection at Fibonacci Resistance Could Extend the AUDUSD Decline_1

A Rejection at Fibonacci Resistance Could Extend the AUDUSD Decline_1

Technical Analysis

AUDUSD started to recover after reaching its local low at 0.6894 on October 15. However, the current upward retracement has recently reached the local resistance area around 0.7070, where several technical factors converge. In addition to the horizontal resistance level, the 200-period moving average is located at 0.7062, while the 100-period moving average stands at 0.7067. Both moving averages are therefore aligned with the resistance zone, adding further weight to this area. Furthermore, the 0.50 Fibonacci retracement level is also located around the same price region, creating a confluence of resistance that could limit the current recovery and potentially trigger a resumption of the downward impulse.

Looking at the oscillators, the RSI recently reached 66 but failed to move above that level. It has since declined to 41, placing the indicator in bearish territory and suggesting that downside momentum currently has the advantage. Meanwhile, the MACD is showing a bearish histogram that is beginning to gain depth, while its signal lines are approaching a potential move below the neutral level. If this bearish crossover takes place, both oscillators would point in the same direction, reinforcing the downside scenario and suggesting that further declines could represent the path of least resistance.

Trading Recommendations

Trading direction: Sell

Entry price: 0.6994

Target price: 0.6921

Stop loss: 0.7090

Validity: Nov 13, 2026 15:00:00

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