Technical Analysis – AUD/USD lacks convincing drive to alter neutral state

newzeeland_dollarAUDUSD is consolidating now for three-months after the correction off the 0.8000 mark, and directional impetus is still absent. The entangled and relatively horizontal 50- and 100-day simple moving averages (SMAs) are reflecting the pair’s muted demeanour, while the 200-day SMA is defending the positive structure.

The Ichimoku lines are not specifying any increase in directional momentum, while the short-term oscillators are also transmitting weak and mixed signals in sentiment. The MACD and its red trigger line are marginally holding beneath the zero threshold, while the RSI is confronting the 50 level after a small uptick. The stochastic %K line is starting to slide beneath its %D line, indicating that positive momentum may be losing its slight edge.

If price starts to form a positive route, prodding over the 0.7768 level, resistance could originate at the 0.7890 high. If buying interest intensifies, buyers may then challenge the resistance band of 0.7966-0.8006, the latter being the near 37-month peak. Reviving the uptrend could cheer buyers to shoot for the 0.8094 mark, which happens to be the 261.8% Fibonacci extension of the down leg from 0.7413 until 0.6990.

Otherwise, if sellers steer the price below the Ichimoku cloud and the 0.7600 hurdle, early support could arise from the 0.7645 low, before the support base of 0.7531-0.7584 attempts to dismiss a deeper retracement from evolving. In the event the 200-day SMA proves frail, the price may then sink towards the section of 0.7372-0.7461.

Summarizing, AUDUSD is currently stuck between the blue Kijun-sen line at 0.7768 and the 0.7600 handle, with no decisive forces conveying the next price direction. Initially the price will need to nudge out of this zone, and a break above 0.7890 or below 0.7645 could give an inclination of the pair’s next direction.

Origin: XM

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