AUDUSD though having recently failed (in the past two days), appears to persist in tackling the area, from the 200-day simple moving average (SMA) at 0.6642 to the tough border of 0.6684, which includes the 76.4% Fibonacci retracement of the down leg from 0.7031 to the 17½-year low of 0.5506, at 0.6669. The pairs’ efforts to close above this key section is also exhibited within the rising 50-day SMA and the technical indicators.
The MACD, deep in the positive region has climbed above its red signal line, while the RSI’s hike in bullish territory continues above the supportive trend line. Nevertheless, traders need to keep in mind the prevailing negative bearing in the 100- and 200-day SMAs, which have dictated all timeframes for some time now.
To the upside, if the confrontation of the region (0.6642 – 0.6684) proves successful, this may return a neutral bias in the medium-term and a bullish mode in the short-term picture, sending the price to challenge the 0.6749 – 0.6777 section of highs from early February. Next, buyers may meet the 0.6837 inside swing low prior to the 0.6933 resistance of January 16.
Should negative tensions increase, initial support may occur at the mid-Bollinger band, which lies at the 0.6505 low ahead of the 100-day SMA residing above the 61.8% Fibo of 0.6446. Moving lower, an important area from 0.6400 – 0.6345, involving various support obstacles, may halt the decline towards the 50.0% Fibo of 0.6266 and the trough beneath at 0.6253.
Summarizing, a push above the 0.7031 peak would cement a bullish bias in the short-term picture, while a negative bearing may endure if the price remains below the 0.6684 mark and the 200-day SMA, with a break below 0.6212 sparking serious downside worries.
