AUD/USD: can bulls take control and get through 55 DMA?

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Jan 24, 2016.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

    Oct 7, 2015
    Likes Received:
    FXStreet (Guatemala) - AUD/USD, currently with a spot of 0.7008 and in a bearish trend short-term, has been consolidating the supply from the highest point it managed to score since breaking onto the 0.70 handle. The Aussie has been making a number of attempts to break the descending 200 sma on the hourly chart and finally did so with conviction towards the end of last week's trade.

    The major commodity currency got an initial lift on the back of oil spiking above $30 again, despite dropping back and being simply a sure bears bet, but the risk mood was improving as the yuan stabilized, copper also caught a bid and the ECB was upfront calling for action soon. This was triggering profit taking streak with a subsequent adding of longs on stops that propelled the recovery up to and through the 0.70 handle to score a high of 0.7048.

    AUD/USD levels

    Technically, AUD/USD has now run into strong offers at the 55 DMA at the mid point of the 0.70 handle, Valeria Bednarik, chief analyst at FXStreet sees this as bearish and said, " In the same chart, the Momentum indicator maintains its bullish slope, but below its 100 level, while the RSI lost upward strength and turned flat around 46, suggesting the upward corrective movement is already complete and that the pair may now resume its bearish trend."

    Meanwhile, Karen Jones, chief analyst at Commerzbank noted that AUD/USD has already reached the 38.2% retracement of the move down lies at 0.7019 and is upside corrective near term. She explained that a subsequent push through this near term resistance of the 55 day ma at 0.7149 would allow for a return to 0.7220, the 78.6% retracement.
    For more information, read our latest forex news.

Share This Page

free forex signals