Morning Market Update – AUD/USD

The AUD/USD pair still holds the support area and edges higher to the 0.7693 level. Intraday bias the pair remains on the upside direction at this point. The firm breaks of the 0.7693 resistance level will confirm resumption of whole rebound from 0.7635 bottom. In such case, the pair would target projection of the 0.7715 level. On the downside, below 0.7635 the minor support will turn the intraday bias neutral first. But the pair’s near term outlook will stay cautiously bullish as long as the 0.7635 support level holds.

Considering the bigger picture, the current development suggests that rebound from the 0.7635 level is developing into a medium term rise. There is no confirmation of trend reversal yet and continues to treat such rebound as a corrective pattern. A further rise is now expected at the 0.7715 level. The pair breaking of the 0.7693 support level is needed to confirming completion of the rebound. Otherwise, further rise is now in favor.

The recent run lower on the Aussie dollar has been currently has stopped and rebounded from the support area. A huge accelerating bull run has seen the market burst through the key high of the 0.7679 level to now see what looks to be a huge breakout above the high of the 0.7693 level. The market has been limited by the resistance band on numerous occasions in the past few sessions but the weakness of the dollar has driven a breakout. Chasing the Aussie higher here would though be a move filled with a significant reward. The oscillator at the 62 level is higher than it has been in recent days. The pair’s momentum is clearly strong but also incredibly stronger. The pair staying with the bull run may be profitable in the very near term. However, if profit taking hits, it could be a sharp reversal. We keep watching for exhaustion signals. The bulls are looking to continue to gain stronger but again the move looks to hold and a close back inside the corrective signal. Also, the oscillator was close to crossing back above the 50 level before today’s gains. The pair’s move back below the 50 level would be a corrective signal and closing level back inside the band would now be a profit taking signal. The four hourly chart supports around the breakout at the 0.7679 level.

The AUD/USD pair keeps its stability above the 0.7657 level until now, while stochastic heads towards the oversold areas now in attempt to gain the positive momentum and motivates the price to resume the main bullish trend.

Therefore, we will continue to suggest the bullish trend in the upcoming sessions to test by the EMA50, noting that our first target is represented by testing the 0.7715 level.

The pair’s expected trading range for today is between the 0.7657 support and 0.7715 resistance levels.

Expected trend for today: Bullish
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