AUDUSD tests to topside trend line(s) and retracement level

Technical Analysis

Author: Greg Michalowski | audusd

AUD is the strongest of the major currencies today...

AUD is the strongest of the major currencies today...

The AUD was the strongest currency at the start of the day, the USD was the weakest. That makes the AUDUSD the biggest mover. Indeed it is up 0.58% on the day (lower USD, higher AUD). 

AUDUSD on the daily chart tests topside trend line
Technically, that move has the price trading just off the high at 0.6965. The high pricer reached 0.69681. At the high the price is testing a trend line connecting the hgih from April and the high from earlier this month.  A move above has the 38.2% of the move down from the same April high at 0.69738.  

Is the trend line and 38.2% enough to stall the rally?

Increasing the levels importance is on the hourly chart below, the pair is also testing the topsdie trend line which currently comes in at 0.6970 (and moving higher).  The high for the day stalled at that trend line a few hours ago as well (it is higher now).   

As a result, sellers have a couple reasons to lean against the 0.6968-738 area from levels on the daily chart and hourly chart.  A move above, however, would likely trigger stops and move upside momentum. Risk is defined and limited.

AUDUSD on the hourly also tested a topside trend line and 38.2% retracement.

What about the downside potential if resistance stalls the rally?

Staying on the hourly chart above, helping the bullish bias today was a break above the 0.69368 ceiling.  Also the pair moved away from the 50% at 0.69264 and the 100 and 200 bar MA between those two levels at 0.69284 and 0.69332.  That cluster of levels should be a strong support level if sellers can take back control. 

The AUDUSD is the strongest of the major currencies today and in the process moved above some resistance levels, but it has run into some topside resistance that could slow the rise.  
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