HomeContributorsTechnical AnalysisAUDUSD Pauses Bearish Rally In Short-Term, Indicators Turn Positive

AUDUSD Pauses Bearish Rally In Short-Term, Indicators Turn Positive

AUDUSD is paring some of the previous week’s losses, surpassing the 40-day simple moving average (SMA). However, the price returned back below the 23.6% Fibonacci retracement level of the downleg from 0.8135 to 0.7020, near 0.7285 after it created a new peak at 0.7390, a four-month high.

While the technical indicators continue to pick up speed, mirroring the market’s bullish behavior over the past two days, the RSI is still moving in the negative zone, but is pointing up, flagging that a recovery could reemerge in the short-term. The %K line of the stochastic oscillator created a bullish crossover with the %D line, supporting the marginal upside retracement.

In case the pair changes its direction to the upside again, the bulls will probably challenge the 20-day SMA of 0.7260 and then the 23.6% Fibonacci of 0.7285. A break higher, could last until 0.7340, before heading towards the 0.7390 resistance barrier. Further up, the area around the 38.2% Fibonacci could be another potential obstacle for upward movements.

On the flipside, additional declines may send prices until the immediate support area of 0.7160 before the 0.7000 – 0.7040 region comes into view, which includes the 33-month low of 0.7020, reached on October 26.

Summarizing, AUDUSD maintains a bullish bias in the short-term picture, whereas in the medium-term it turned neutral after the pullback on the 0.7390 hurdle.

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