Title: AUD/USD Price Analysis: Pullback towards 20-EMA looks likely
July 18, 20222 01:15 AM ET
The AUD/USD pair recorded a slight correction after showing exhaustion signals while trying to hold above the crucial resistance of 0.6800. The value recorded an intraday high of 0.6820 after continuing the positive trend from Friday.
On the four-hour scale, Aussie bulls pushed the level above the trend line, marking the June 16 high at 0.7070 and the June 28 high at 0.6965. A peak of selling below 0.6700 last week has led to some buying reaction.
AUD/USD has crossed the 20- and 50-period Exponential Moving Averages (EMAs) at 0.6778 and 0.6790, respectively, reinforcing the upside filters. It is worth noting that the 50-period EMA is still higher than the 20-EMA, while the asset has firmly crossed both. This indicates strong, reactive buying action after a steep downtrend.
The Relative Strength Index (RSI) (14) has attempted to cross above the 60.00 level after oscillating in the 40.00-60.00 range. This shows that the Aussie bulls need more strength to push the value higher.
A pullback move towards the 20-EMA at 0.6778 will allow more investors to join the ongoing rally. If so, the price would move towards Monday's high at 0.6819, followed by the July 8 high at 0.6875.
On the other hand, the greenback bulls could take the lead if the level falls decisively below the July 5 low at 0.6761. This would send the pair towards Tuesday's low at 0.6710. A slide below Tuesday's low would pull the value towards Thursday's low at 0.6680.