Jan 13 (Reuters) - The Australian dollar has been in a clear downtrend since hitting a 19-month high of 0.6943 in October but proximity to a long-term support level and an over-extended 11.3% drop may slow the decline.

The AUD's fall to a near five-year low of 0.6139 on Friday brings key support at 0.6099, the 76.4% Fibonacci retracement of its post-COVID rally from 0.5510 to 0.8007 into play.

The Relative Strength Index, a key momentum indicator that measures the magnitude of recent price changes to analyse overbought or oversold conditions, is showing divergence as the AUD/USD price makes a new low but the RSI moves higher - a warning sign of an oversold market.

While these technical factors may slow the AUD's drop, fundamental factors point to an eventual extension of the decline.

The robust U.S. labour market, sticky inflation and rising inflation expectations have spurred doubts about further Federal Reserve interest rate cuts. Concerns over the inflationary effects of President-elect Donald Trump's policies, rising Treasury yields and their knock-on effect on "priced-to-perfection" stock markets have also pummelled the AUD.

Growing expectations of a 25-basis-point February rate cut by the Reserve Bank of Australia and an elusive Chinese economic recovery are adding to the AUD's woes.

The currency faces further risks from U.S. inflation, Australia employment, China trade and monthly activity data and the Jan 20 U.S. Presidential inauguration in the week ahead.

A clear loss of 0.6099 would open a ratchet lower to 0.5980-0.6000, the April 2020 low and psychological support.

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(Krishna Kumar is a Reuters market analyst. The views expressed are his own. Editing by Sonali Desai)

((krishna.k@thomsonreuters.com))