The 0.74367-436 remains a key resistance area
The AUDUSD is the biggest mover on the day vs. the USD. The USD is weaker vs the AUD (AUDUSD higher) by 0.56%).
However, that move is off the extreme for the pair. You can see that in the chart below. Although the AUDUSD is still up 40 pips, it is off the highs.
What is helping to stall the run higher?
Looking at the hourly chart below, the price run higher today reached a key swing area in the 0.7436-43 area (see yellow area in the chart below). The high reached 0.74388 and stalled for about 5 hours.
The price is starting to move lower with the price trading at the 07425 level currently.
With the area above holding it defines risk for those traders looking for a corrective move lower. It is not the first time and traders like patterns. Plus risk can be defined and limited against the level.
Does it mean the pair goes tumbling lower like it did on the last test and reversal at the green circle 7 point?
Not necessarily, but there will be hurdles/targets that will give clues.
- The 61.8% at 0.74193
- The underside of the broken trend line at 0.74105 (and moving lower)
- The 50% of the move down from the July 25/26 highs at 0.74056.
- The 200 and 100 hour MAs at 0.8397 and 0.73899 respectively.
That is a lot of hurdles, but they are the roadmap for sellers.
For dip buyers, you can use those levels too to buy a dip. Given the run higher today, I would expect that the 0.7410-19 area should attract buyers if this is just a correction of the move higher. Watch that area.