AUDUSD has been in a bullish phase since December, reaching the key 0.8000 level today, its highest point since September 2017. The market is pausing the rally at the moment, shifting the immediate bias to neutral after becoming overstretched. The RSI on the daily chart is in overbought territory above 70.
As upside momentum has faded, AUDUSD is expected to remain under pressure, making a correction lower. The psychological level at 0.8000 is considered to be a strong resistance level which needs to be breached soon if the bullish phase is going to continue. Otherwise, if prices hover at current levels for too long, the risk could turn to the downside towards 0.7900. A daily close below 0.7800 would indicate that a short-term top is in place at 0.8000.
Overall, AUDUSD has entered a fresh leg up within the current uptrend from December and there is scope for another push higher to re-test the September high of 0.8124. But there is caution in the near term as technical indicators show the market is overbought at the moment.
Origin: XM
