Technical Analysis – AUD/USD testing key 0.76 level, retains bullish bias.
This article is originally referred from XM Investment Research Desk.
AUD/USD is retesting the key 0.76 level this week with three successful daily closes above this. The 0.76 level that was previously resistance (tested in June) has now turned into a key support level.
Next resistance lies at 0.7685, which is the 78.6% Fibonacci Retracement of the down-leg from 0.7833 to 0.7144. A break above this would open the way for a test of the April high of 0.7833 (the highest in a year).
Alternatively, if support at 0.76 fails, the market would move lower towards the 61.8 Fibonacci (0.7568) and then towards the key 0.75 level. Just below this is the 50% Fibonacci at 0.7486 where there was some congestion in the first week of July, making this an important level.
The short term outlook remains bullish as long as the market remains above the 200-day moving average which coincides with the key psychological level at 0.74. RSI is above 50 and this supports a bullish bias. A drop below the 200 MA could see prices retest the 0.7144 low and below this we could see a resumption of the bearish trend that took place from 0.7833 to 0.7144.
Original Source: XM Investment Research Desk