AUD/USD Technical Analysis: Falling channel comes into play, RBA's Lowe says low rates would lead to lower Aussie

AUD/USD is currently chipping away at the lower edge of the 4-hour chart falling channel, currently at 0.7166.

Earlier today, RBA's Lowe shifted the forward guidance to neutral by putting rate cuts back on the table. In response, the Aussie has dropped sharply across the board.

The AUD/USD pair has shed more than 70 pips in the last 60 minutes and could slide further toward 0.7138 (support of Jan. 28 low) if the channel support of 0.7166 fails to hold ground.

1-hour chart

As seen above, the RSI has hit the oversold territory below 30.00. Hence, a minor bounce could be in the offing, before a potential sell-off toward 0.7138.

It is worth noting that the European FX desks are yet to respond to RBA's change of attitude on interest rates. Put simply, another wave of selling could hit the AUD pairs in European hours.

Trend: bearish