AUD/USD Price Analysis: Extends uptrend towards next set of targets

AUD/USD has established an uptrend which continues extending.
The RSI is overbought but has not yet given a sell signal.

Joaquin Monfort FXStreet

AUD/USD has established a sequence of higher highs and higher lows on the 4-hour chart since it started rising off of the August 5 lows. This indicates the pair is in a short-term uptrend, and given “the trend is your friend” suggests a bias to further upside.

AUD/USD 4-hour Chart

The pair consolidated briefly in the 0.6730s before continuing higher to the 0.6750s.

AUD/USD will probably continue up to the next line of resistance at 0.6760, followed by 0.6799, the July 11 high.

The Relative Strength Index (RSI) is in overbought territory, increasing the chances of a pull back. However, it would have to exit overbought territory and fall back below 70 on a closing basis to provide confirmation of a sell signal. Such a move would probably coincide with a pull back.

Despite the overbought RSI, AUD/USD could still go higher, although long holders would not be advised to add to their existing positions whilst RSI remains above 70.

Author

Joaquin Monfort

FXStreet

Joaquin Monfort is a financial writer and analyst with over 10 years experience writing about financial markets and alt data. He holds a degree in Anthropology from London University and a Diploma in Technical analysis.

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