The new trading week is underway, and the pessimism surrounding the greenback still leaves a noticeable mark on it. This has put AUD/USD bulls in the lead early in this week’s trading activity. The Aussie seems to be more active on the fundamental front and, as such, may provide more clues.
Key Price Levels:
Resistance Levels: 0.6850, 0.6900, 0.6950
Support Levels: 0.6800, 0.6750, 0.6700
AUD/USD Bulls Retain the Lead
AUD/USD earlier rebounded after significantly testing the 0.6637 support level two weeks ago. Since then, the market has moved higher and has crossed the middle limit of the Bollinger Bands (BB) indicator. The Fed’s interest rate decision has further fueled volatility, as seen in the widening of the BB indicator recently.
Price action recently bounced off the upper limit of the Bollinger Bands, but upside forces seemed up to the task as they regained control, returning the market to an upward path. In line with this, the Stochastic Relative Strength Index (Stochastic RSI) is oriented toward the 50 level from the oversold region. Technical indicators align with a continued upward movement.
AUD/USD Coils Up for More Upside Thrust
Price action in the AUD/USD 4-hour market continues to suggest that upside forces are set to cause further price increases. Here, price activity is above the middle limit of the BB indicator. Additionally, both the upper and lower limits of the indicator have contracted significantly.
Technically, this contraction hints at a potential upward correction that may receive more momentum. Meanwhile, the Stochastic RSI lines are already at the 100 level, moving sideways. This behavior suggests that upward forces may still have the chance to propel the market higher. Given the BB indicator’s contraction, traders can aim for the 0.6850 threshold.
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