- AUD/USD seesaws in the early European session.
- Bulls face rejection near the 0.7760 mark.
- Momentum oscillator in the overbought zone asks for a wait-and-watch approach.
The AUD/USD pair edges lower on Wednesday in the initial European trading hours. The pair makes very restricted moves with negative bias.
At the time of writing, AUD/USD is trading at 0.7735, down 0.06% for the day.
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On the daily chart, the AUD/USD pair has been trading inside the Head and Shoulders pattern, a bearish reversal trading formation. The pair is expected to trade lower once it breaks the 0.7730 key psychological mark.
AUD/USD could be directed toward the 0.7710 horizontal support level followed by the low of May 28 at 0.7676.
The Moving Average Convergence Divergence (MACD) trades in the overbought trajectory with receding bullish momentum. This would bring more selling opportunities for AUD/USD bears, as they would be encouraged to meet the 0.7650 horizontal support level.
Alternatively, if price sustains above the 20-hour Simple Moving Average (SMA) at 0.7735, then it could continue to move upward towards the high of June 7 at 0.7766.
Market participants would then be traced back to May 18 high at 0.7814, followed by the 0.7840 horizontal resistance level.
