AUDUSD is set for its third monthly gain, having been trading bullish almost every single week since the slump to a 30-month low of 0.6169 in mid-October,.
The pair is currently flirting with August’s high of 0.7136, while the 61.8% Fibonacci retracement of the 0.7660-0.6169 downtrend might be another warning zone at 0.7185 as the RSI and the Stochastics flag overbought conditions. Note that the price keeps fluctuating around the upper Bollinger band area, increasing the odds of a downside correction as well.
Nevertheless, the positive trend in the short-term picture looks healthy and the progressing golden cross between the 50- and 200-day simple moving averages (SMA) is suggesting that any downside move might be temporary and part of the bullish course.
If the pair slides below 0.7065, it may seek support near the 0.7000 psychological mark before confronting the 0.6940-0.6860 zone, which encapsulates the 50% Fibonacci level, the 20-day SMA, and two key constraining trendlines. A break lower and beneath the 0.6800 number would downgrade the short-term outlook to neutral, bringing the 0.6740-0.6700 region next on the radar. A steeper decline could tackle the 0.6600 level.
Should the bulls clear the 0.7136-0.7185 resistance territory, they may next head for June’s bar of 0.7282. Another success there may open the door for the 0.7375 barrier, while higher, the uptrend may stretch up to 0.7450.
Summing up, AUDUSD is preserving a bullish bias in the short-term picture, aiming for new higher highs. Yet some consolidation could be possible as the pair seems to have reached overbought levels.