AUD/USD Price Analysis: Attempts to deliver a bullish reversal
- AUD/USD has rebounded after sensing a cushion around 0.6700 amid a recovery in investors’ risk appetite.
- Hopes for a bullish reversal will be fueled further in case AUD/USD delivers a break above the 50-EMA.
- A 40.00-60.00 range oscillation by the RSI (14) indicates indecisiveness among the market participants.
The AUD/USD pair has shown a recovery move after defending the round-level support of 0.6700 in the early Asian session. A loss in the downside momentum is exhausted, however, the Aussie asset would get a sense of confidence only after a confident break above the immediate resistance of 0.6740.
S&P500 futures are displaying nominal losses after a meaningful recovery, portraying a caution in the overall risk appetite theme. The struggle from the US Dollar Index (DXY) for recapturing the 105.00 resistance continues amid a recovery in the risk-on market mood. Meanwhile, the 10-year US Treasury yields are looking to continue their upside momentum above 4.06%.
A double bottom chart formation on a two-hour scale by AUD/USD around March 01 low at 0.6700 has triggered the case of a bullish reversal. The Australian Dollar tested March 01 low at 0.6700 with less selling pressure, which propelled the responsive buying from the market participants. The downward-sloping trendline plotted from February 14 high at 0.7030 has acted as a major barricade for the Australian Dollar.
Hopes for a bullish reversal will be fueled further in case the AUD/USD pair delivers a break above the 50-period Exponential Moving Average (EMA) at 0.6750.
The Relative Strength Index (RSI) (14) is still oscillating in the 40.00-60.00, indicating indecisiveness among the market participants.
A confident break above March 01 high at 0.6784 will send the asset toward the round-level resistance at 0.6800 followed by February 06 low at 0.6855.
In an alternate scenario, a slippage below March 01 low around 0.6700 will drag the Aussie toward December 07 low at 0.6669 and December 20 low at 0.6629.
AUD/USD two-hour chart
Author
Sagar Dua
FXStreet
Sagar Dua is associated with the financial markets from his college days. Along with pursuing post-graduation in Commerce in 2014, he started his markets training with chart analysis.
