It has been a while when the AUDUSD triggered a major long-term buy signal on the weekly chart so let’s check if we still do have a positive sentiment here.
First buy signal was created as early as at the beginning of the year (January), when the price broke the black down trend line, connecting lower lows since the April 2013. Although it was a positive sign, the price failed to climb higher straight away. For the major fireworks, we had to wait till July. First of all, we broke the upper line of the symmetric triangle formation (red lines, which was developing on the chart since the beginning of 2015). After that, the price broke the horizontal resisatance around the 0.778 (two years highs) and using the newly created bullish momentum, the 23,6% Fibonacci. Those two are currently the closest supports. 23,6% Fibonacci was already tested few times and all were positive for buyers. Along with those horizontal supports, we do have a dynamic one – a mid-term up trendline (green).
So what is the situation here? Bullish. The price being above all major local supports is a strong buy signal and with this sentiment, we should not have any problems to make new yearly highs in the nearest future.
This article is written by Tomasz Wisniewski, a senior analyst at Alpari Research & Analysis