Having initially displayed a negative wave of bearish price action, the Australian dollar has respectively rebounded in front of the 0.6870-80 support region Tuesday.
With the week kicking off with a widespread sell-off against the US dollar, a minor bullish correction could be seen in the short term.
The bearish sentiment was triggered late last week amid concern about the U.S. Federal Reserve’s ability to tame inflationary spirals without throwing the economy into a recession.
Based on the technical assessment, the Relative Strength Index (RSI) 3-daily ‘lookback’ indicator is negative, bullish divergence is emerging, while the Moving Average Convergence Divergence (MACD) holds a negative signal.
The ADX (trend) indicator supports a mild bear trend.
From the given rebound, if the bullish divergence can strengthen, the upside call could reach the region of 0.7055. Reassess from there.