• AUD/USD extends pullback from intraday high, stays near two-year low.
• PBOC cuts 14-day reverse repo rate to 2.15%.
• Ascending support line from mid-July restricts immediate downside.
• Bearish MACD signals, downbeat RSI favor sellers inside four-month-old bearish channel, 50-DMA restricts immediate recovery.

AUD/USD pulls back from its intraday high towards 0.6700, around 0.6720 by the press time, as it reacts to the People’s Bank of China’s (PBOC) recent rate cut during Monday’s Asian session.

That said, the Chinese central bank lowers the 14-day reverse repo rate by 10 basis points (bps) to 2.15%. “With no reverse repos maturing on Monday, China central bank injects 12 billion yuan on the day,” per Reuters.

Technically, the bearish MACD signals and the downbeat RSI (14), not oversold, keeps AUD/USD sellers hopeful of revisiting an upward sloping support line from mid-July, near 0.6700 by the press time.

It should, however, be noted that the Aussie pair’s downside past 0.6700 needs validation from the latest multi-month low near 0.6680 before aiming for the support line of a four-month-long bearish channel, close to 0.6565 at the latest.

On the contrary, recovery moves remain elusive until the quote crosses the 50-DMA hurdle surrounding 0.6890. However, a 12-day-long horizontal resistance and 50-SMA on the four-hour chart, near 0.6770-75, seem to restrict immediate upside.

Above all, the AUD/USD bears keep reins until the quote stays below the stated bearish channel’s resistance line, around 0.7060 by the press time.

AUD/USD: Daily chart

Trend: Further weakness expected