Technical Analysis – AUDUSD surges above 200-day moving average; records 9-day high

Posted on April 13, 2017 at 7:21 am GMT by the XM Investment Research Desk

AUDUSD gained approximately 1% since the day’s open as it rose above the 200-day moving average (MA), setting a nine-day high.

The RSI is theoretically neutral at 50 but steeply rose from bearish territory to reach its current level. As regards the stochastics, the %K line is in bullish territory -though not far above its neutral level- and above the slow %D line. Both indicators underlie the strong upside momentum currently in place.

The area formed by the current level of the middle-Bollinger line at 0.7605 and the 50-day MA at 0.7623, come into view as an immediate potential barrier to the upside. If the price heads further up, the March 30 three-week high of 0.7679 could offer additional resistance. Above it, the focus would shift to the upper-Bollinger band at 0.7739 and the March 31 five-month high of 0.7749 as another area of significance.

On the downside, the 200-day MA at 0.7552, which failed to cap a break above it earlier in the day, could instead offer intra-day support. Below this level, the March 9 three-month high of 0.7472 which roughly coincides with the lower-Bollinger band might offer additional support.

Looking at the medium-term picture, the pair recorded a bullish (golden) cross on March 6 when the 50-day MA moved above the 200-day one. Subsequent price action has not been fully supportive of this signal though and in the bigger picture the pair appears to have been in consolidation mode over the last number of months.

Overall, the short-term picture is neutral to bullish and the medium-term is neutral.

Source: www.xm.com