AUD/USD breaches 55– and 100-hour SMAs
Following three session of constant tests of the 55– and 100-hour SMA, the Australian Dollar finally managed to gather enough momentum and push below this support cluster. This area is likewise reinforced by the weekly PP.
During the time of this analysis, the Aussie had tried to move above the latter, but nevertheless failed to do so. The pair was testing a one-month up trend mid-day. If this level is breached, it is likely that the Aussie’s subsequent movement is tended southwards. A strong support is provided by the 50.0% Fibo retracement, the 200-hour SMA and the weekly S1.
By and large, the rate should remained squeezed between the narrowing moving averages until either bulls and bears demonstrate a more distinct direction.
During the time of this analysis, the Aussie had tried to move above the latter, but nevertheless failed to do so. The pair was testing a one-month up trend mid-day. If this level is breached, it is likely that the Aussie’s subsequent movement is tended southwards. A strong support is provided by the 50.0% Fibo retracement, the 200-hour SMA and the weekly S1.
By and large, the rate should remained squeezed between the narrowing moving averages until either bulls and bears demonstrate a more distinct direction.
Comment:
AUD/USD spent the second half of Tuesday’s trading session below the 200-hour SMA. It had failed to overcome this line until early today when a strong hourly surge pushed the rate through the 200-, 55– and 100-hour SMAs.
During this time, the pair was testing the bottom boundary of a five-week channel. An upside breakout of the aforementioned SMAs suggest that the Aussie might still continue respecting the channel. However, given the steepness of this pattern, its upper boundary is unlikely to be reached. Technical indicators confirm that this might be the most likely scenario for the following session.
The nearest resistance is the weekly R1 at 0.7892, while support is provided by the 55– and 200-hour SMAs near 0.7830.
During this time, the pair was testing the bottom boundary of a five-week channel. An upside breakout of the aforementioned SMAs suggest that the Aussie might still continue respecting the channel. However, given the steepness of this pattern, its upper boundary is unlikely to be reached. Technical indicators confirm that this might be the most likely scenario for the following session.
The nearest resistance is the weekly R1 at 0.7892, while support is provided by the 55– and 200-hour SMAs near 0.7830.
Comment:
Upside risks prevailed in the market on Wednesday and thus sent the Aussie for a surge against the US Dollar. As a result, the pair was able to breach a significant resistance cluster set by the 55-, 100– and 200-hour SMAs circa 0.7840 .
In addition, additional bullish momentum was provided by solid Australian Retail Sales published at 0030GMT.
The first part of Thursday shows a slight period of uncertainty from both bulls and bears, as the Aussie has failed to leave the 0.7870 mark. It is likely that this situation continues until US PPI is published.
This data release might result in fluctuations for an hour or two; however, the overall direction for the following session is still expected to be southwards towards the aforementioned 0.7840 area.
In addition, additional bullish momentum was provided by solid Australian Retail Sales published at 0030GMT.
The first part of Thursday shows a slight period of uncertainty from both bulls and bears, as the Aussie has failed to leave the 0.7870 mark. It is likely that this situation continues until US PPI is published.
This data release might result in fluctuations for an hour or two; however, the overall direction for the following session is still expected to be southwards towards the aforementioned 0.7840 area.
However, by 14:00 GMT it could be noticed that the following rebound had been short lives, as the pair had bounced off the resistance of a previous support line.
Because of that reason Dukascopy analysts expect that the pair will continue the decline and approach the weekly PP, which is located at the 0.7794 level.