Since early November, AUD/USD price has been on a steady rise while remaining above the 50 Simple Moving Average and producing higher highs and higher lows. But since November 10th, the RSI oscillator started to form a bearish divergence, implying the potential downside move, which could be either a correction or even a trend reversal.
The key resistance is located at 0.7412, which is the high produced back on September 1st. And by looking at the daily chart, it can be seen that AUD/USD could be is forming a double top.
Of course, it is yet to be confirmed as the key support at 0.7338 is still being respected. This support is the previous supply area, where most recently the 50 SMA was rejected.
Therefore, in order to confirm an increasing downside momentum, AUD/USD must break and close below 0.7338, 50 SMA, and the support trendline on the daily timeframe. If/when this occurs, the probability of a downtrend will become substantially higher than the uptrend continuation. Upon the break below, AUD/USD could be aiming for one of the Fibonacci support levels.
The nearest support is at 0.7262, which is a 23.6% Fibonacci retracement level. Then goes the 38.2% Fibs at 0.7169, which could be the most important demand zone for AUD/USD. This is because previously this level acted as the supply/demand area, and it is also confirmed by two Fibs, 38.2% and 427.2%, as can be seen on the chart.
Up until the point when a break below the current support occurs, buyers are likely to be in control, attempting to push price higher. Daily break and close above the 0.7412, will invalidate the expectancy for the AUD/USD decline, and in this case, the uptrend is likely to continue.
Key support levels: 0.7338, 0.7262, 0.7169, 0.7094
Key resistance levels: 0.7392, 0.7412
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Disclaimer: The analysis presented in this article is for educational purposes only and should not be considered as financial advice.
The key resistance is located at 0.7412, which is the high produced back on September 1st. And by looking at the daily chart, it can be seen that AUD/USD could be is forming a double top.
Of course, it is yet to be confirmed as the key support at 0.7338 is still being respected. This support is the previous supply area, where most recently the 50 SMA was rejected.
Therefore, in order to confirm an increasing downside momentum, AUD/USD must break and close below 0.7338, 50 SMA, and the support trendline on the daily timeframe. If/when this occurs, the probability of a downtrend will become substantially higher than the uptrend continuation. Upon the break below, AUD/USD could be aiming for one of the Fibonacci support levels.
The nearest support is at 0.7262, which is a 23.6% Fibonacci retracement level. Then goes the 38.2% Fibs at 0.7169, which could be the most important demand zone for AUD/USD. This is because previously this level acted as the supply/demand area, and it is also confirmed by two Fibs, 38.2% and 427.2%, as can be seen on the chart.
Up until the point when a break below the current support occurs, buyers are likely to be in control, attempting to push price higher. Daily break and close above the 0.7412, will invalidate the expectancy for the AUD/USD decline, and in this case, the uptrend is likely to continue.
Key support levels: 0.7338, 0.7262, 0.7169, 0.7094
Key resistance levels: 0.7392, 0.7412
Thanks for your support! If you liked this analysis, please support our profile with a 👍 and follow us to get a new daily analysis.
Disclaimer: The analysis presented in this article is for educational purposes only and should not be considered as financial advice.