🏄 Grow your portfolio even on vacation with InvestingPro | Summer Sale 50% OFFCLAIM SALE

AUD/USD Snaps Key Barrier, But Stronger Efforts Needed

Published 07/29/2021, 06:33 AM

AUDUSD opened above the red Tenkan-sen line on Thursday, with scope to finally snap the Ichimoku line, which held the bulls under control since mid-June, and re-challenge the nearby 0.7400 resistance territory.

The positive momentum in the RSI is currently endorsing the bullish action above the eight-month low of 0.7288, though some caution is still required as the indicator has yet to create a new higher high, maintaining a sideways trajectory below its 50 neutral level. The upside reversal in the MACD is also encouraging, but a break into the positive zone would generate stronger bullish signals.

In other cautious warnings, the 50- and 200-day simple moving averages (SMAs) have completed a death cross for the first time since 2018, flagging a definitive negative trend reversal.

In the short term, the price may attempt to close above the 0.7400 – 0.7430 area, which encapsulates the 20-day SMA and the 23.6% Fibonacci retracement of the 0.7890 – 0.7288 downleg. If efforts prove successful, the bulls could accelerate towards the 38.2% Fibonacci of 0.7518 unless the 0.7475 barrier capes the rally. Steeper increases could meet the 50-day SMA at 0.7559, while a decisive step above the 50% Fibonacci of 0.7589 and the 200-day SMA could be a bigger achievement.

Should selling pressures resurface, the spotlight will turn back to the 0.7288 low, a break of which could find immediate support within the 0.7255 – 0.7230 region, last seen in November. If the latter fails to act, the pair could stretch its downtrend towards the restrictive line from January around 0.7130.

In brief, buying pressures could persist in AUDUSD, though only a close above 0.7030 would confirm a bullish bias. In terms of the market's prevailing trend, the downward direction may stay intact for now.

AUDUSD_29_07

3rd party Ad. Not an offer or recommendation by Investing.com. See disclosure here or remove ads.

Which stock should you buy in your very next trade?

AI computing powers are changing the stock market. Investing.com's ProPicks AI includes 6 winning stock portfolios chosen by our advanced AI. In 2024 alone, ProPicks AI identified 2 stocks that surged over 150%, 4 additional stocks that leaped over 30%, and 3 more that climbed over 25%. Which stock will be the next to soar?

Unlock ProPicks AI
Read Next

Latest comments

Tu Dang PhuocJul 29, 2021, 19:55
Quite long term, quantitative with full picture. Many thanks.
Loading next article…
Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2025 - Fusion Media Limited. All Rights Reserved.