AUDUSD is in a bullish phase in the short term after a strong rally off the key 0.7500 area was extended up to a 2-month high.
The recent rebound in AUDUSD has room to extend towards 0.7900 since prices crossed above the 200-day moving average and RSI is rising. However, the stochastic is overbought, which suggests prices could risk pulling back.
The market is currently testing the key 0.7800 level. A daily close above it would help keep momentum to the upside. A drop back below the 200-day MA (0.7690) would indicate that the bullish phase has ended and AUDUSD risks dropping down to 0.7500. This is expected to provide strong support though. Any move lower would see a resumption of the downtrend from the 0.8124 peak.
In the meantime, the short-term bullish phase is still in progress. A sustained move above 0.7800 could see the rally continue, with dips supported at 0.7690.
