The AUDUSD has taken another step higher in trading today, continuing the move away from the consolidation area (see VIDEO from yesterday HERE where I talk about the pair, and my post from yesterday “Forex Technical Trading: AUDUSD getting out of the woods“). The pair has gotten further out of the woods and into greener pastures.
AUDUSD has moved above the high for October at 0.8897
The high today has surpassed the high for October at 0.8897 and looks toward the 38.2% retracement of the move down from the September high to the October low at the 0.89318 level (see daily chart above). The 0.90213 level is another target if the bulls can remain in control but that is for another day.
Looking at the 5 minute chart below , the pair accelerated the move higher in the last hour by extending above the topside channel trend line. The move (and momentum) above that line could not be sustained and the price is now back in the channel. Did the pair go too far/too fast? Perhaps. It certainly give traders (and myself) a little cause for pause (profit taking).
AUDUSD accelerates but stalls a bit.
Looking at the hourly chart, the price high move higher approached a topside trend line a at the 0.8912 level (the high reached 0.8910). This too may start to weigh on being overly bullish. I still think that the AUDUSD has bullish potential but as we all know, there are swings in all moves. The move may settle down a bit and regroup. Nevertheless, look for dip buyers against the aforementioned support to give a bullish clue.
AUDUSD approached topside trend line and found some sellers.
There could be a rotation lower toward the lower channel trend lien support on the 5 minute chart and the 38.2-50% of the last trend leg higher today (at 0.88848-0.8892). I would expect buyers on a dip here but the highs may be in place pre-FOMC. A more dovish Fed will be eyed for the next catalyst toward the retracement topside targets.
