The momentum gain in the US dollar has been enough to put this pair under bearish pressure in recent weeks. And with the new week about to unfold, the pair may experience yet more downward retracements as the United States Consumer Price Index (CPI) is set to emerge later this week.
Major Price Levels:
Resistance Levels: 0.6400, 0.6500, and 0.6600
Support Levels: 0.6374, 0.6300, and 0.6200
AUDUSD Is Finding It Hard to Significantly Crack the Support at $0.6380
Last weeks trading saw the AUDUSD retrace a previously avoided support, initially very quickly, but soon slowing as soon as the support level was reached. Although that support has been broken now, it could be perceived that price action is experiencing some difficulty progressing significantly downwards from this support.
During the close of last week’s trading, the pair started trading below the 0.6380 mark, which lies considerably below the 9- and 21-day Smooth Moving Average (SMA) curves. Also, the Relative Strength Index lines are now deep in the oversold region and dont look ready for a crossover.
AUDUSD Price Action May Be Presenting Traders with False Upside Hopes
Indications from the AUDUSD 4-hour market seem to be pointing out that an upside correction may occur. Price candles can be seen still appearing very close to the SMA lines and the 0.6380. Meanwhile, the Stochastic RSI lines have just delivered an upside crossover just above the 50 level of the indicator, despite the fact that price action remains below the SMA curves.
This seems to be pointing to an upside correction, which may take the price back above the 0.6400 threshold. However, should a better-than-expected CPI emerge this week, the downward retracement will strengthen, which may force prices toward the 0.6300 mark. Traders may have to maintain their positions ahead of the coming US fundamental.
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