Technical Analysis – AUDUSD finds strong ceiling at 0.7000; holds in upward channel

Ioannis Fotiadis, XM Investment Research Desk

AUDUSD found strong ceiling near the 0.7000 psychological level in the ascending channel that has been holding since June 15. Technically, the MACD oscillator is still flattening above the zero level with weak momentum, while the RSI is sloping down near the 50 level. The 20- and 40-period simple moving averages are moving horizontally confirming the recent neutral move.

If the pair successfully surpasses the 0.7000 handle, it could gain some ground towards the 0.7040 barrier ahead of the 14-month peak of 0.7065. On steeper increases, the pair could revisit the 0.7200 psychological number, taken from the high on April 2019.

Alternatively, a drop beneath the SMAs could hit the 0.6960 support, which overlaps with the upper surface of the Ichimoku cloud. Even lower, the 0.6920 and the ascending trend line around 0.6900 could come in focus before shifting the bullish bias to neutral testing the 0.6830 support level, registered on June 30.

Summarizing, AUDUSD has been developing in an upward sloping channel over the last month and only an exit either up or down from this zone could switch the slightly bullish move to strongly positive or neutral.