The AUDUSD moved to the lowest level since August yesterday and in the process tested the lowest level going back to November 2023 near 0.6334. The price bounced higher into the close, ending the day at 0.6368 – just above the swing area high (see red numbered circles) on the daily chart at 0.6363.
The subsequent rise in trading today, has seen the price extend above the 100 hour MA at 0.6397 (call it 0.6400) and to a high that stalled right against the falling 200 hour MA (green line). Buyers turned to sellers, and the price has since rotated back down. The price is trading near the close from yesterday, completing the lap higher and lower.
What next?
The buyers had their shot and they stalled at MA technical resistance (200 hour MA). With the price back below the 100 hour MA at 0.6397 (and swing level around that level), it would now take a move back above that level to give the buyers some hope.
On the downside, the low swing area on the daily at 0.6334 to 0.6363 remains a solid support but give the run to the downside, Dip buyers may continue to lean as risk can be defined and limited. However, a break below that area with the overall trend over the last few months being to the downside, would likely lead to a continuation lower from a technical perspective.
So the lines have been drawn. Can the sellers now push to new limits?
This article was written by Greg Michalowski at www.forexlive.com. Source