August 9, 2022 01:16 AM ET
By: AnalysisWatch
The AUD/USD pair shows a correction in time after a vertical upward movement to near the psychological resistance of 0.7000. The Aussie bulls experienced a huge bounce after defending the weekly lows at 0.6886 on Friday.
On the hourly scale, the stock forms a bullish flag chart pattern, indicating consolidation after an upward movement. A typical phase of stock distribution in a bullish flag is used to enter long positions by investors who prefer to enter an auction after a bullish trend has formed.
The antipode is defending the 20-period Exponential Moving Average (EMA) at 0.6974, and the asset has also managed to confidently establish itself above the 200-EMA at 0.6954, reinforcing the upside filters.
Meanwhile, the Relative Strength Index (RSI) (14) has moved back to the 40.00–60.00 range after failing to hold in the bullish 60.00–80.00 range. A break above 60.00 would further strengthen the Aussie bulls.
A decisive rise above the six-week high at 0.7047 will send the major towards the round resistance at 0.7100, followed by the May 31 high at 0.7204.
A downside break below Wednesday's low at 0.6885 will pull the major toward the July 15 high at 0.6806.
A slide below the July 15 low will trigger downside risk to the July 5 low at 0.6761.
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