AUDUSD Completes ‘Death Cross’ But Bullish Structure Intact

Technical analysis of Forex market

AUDUSD has been marching higher after finding its feet at the 22-month low of 0.6828 in early May. However, the pair’s advance is currently on pause as the 200-day simple moving average appears to be acting as a strong resistance barrier for the price.

The momentum indicators suggest that bullish forces have gained total control. Specifically, the MACD histogram has jumped above both zero and its red signal line, while the RSI is ascending in beyond its 50-neutral threshold.

If buying pressure intensifies further and the price profoundly crosses above the 200-day SMA, initial resistance could be encountered at the January peak of 0.7315. Piercing through this region, the bulls could aim at 0.7460 before the spotlight turns to the 0.7555 obstacle. An upside violation of the latter might pave the way for the 2022 high of 0.7660.

On the downside, should positive momentum wane and the price reverse downwards, 0.7138 could act as the first line of defence. Breaching this floor, further declines may then cease at 0.7036 before 0.6953 appears on the radar. Failing to halt there, the price could then descend to challenge the 22-month low of 0.6828.

Overall, AUDUSD appears to have the necessary momentum to push even higher and resume its short-term upside trajectory. For that scenario to materialize, the price needs to initially cross above its 200-day SMA.