AUDUSD is continuing its slightly upside tendency following the rebound on the decade low of 0.6746, recording a one-month high of 0.7235 earlier today.
The price has successfully surpassed the 20- and 40-simple moving averages (SMAs) confirming another possible upside wave in the market. The short-term bias looks positive as the MACD keeps gaining ground above its red trigger line, while the RSI seems to be making its way up above its 50-neutral level. However, looking at the stochastic oscillator the %K line completed a bearish cross with the %D line indicating an overstretched upside rally in the market.
The 38.2% Fibonacci retracement level of the downleg from 0.8135 to 0.6746, around 0.7275 could be trigger point for steeper bullish actions if the price jumps above the significant obstacle of 0.7235. If the price manages to break this line the 0.7340 – 0.7390 resistance zone should attract some attention.
On the other side, if the pair reverses back to the downside, investors could find strong support at the 40- and then at the 20-SMAs at 0.7177 and 0.7110 respectively. If the price continues to slip, support could next come near the 23.6% Fibonacci region of 0.7070, before the focus turns again at the 0.6825 barrier, registered by the low on January 2016.
In the long-term view, AUDUSD has been retaining its descending movement over the last year. Chances for a strong bullish tendency would come if the pair breaks the 61.8% Fibonacci of 0.7600.
Origin: XM
