AUD/USD Clears May High to Test 50-Day SMA for First Time Since March
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Australian Dollar Talking Points
AUD/USD pulls back from a fresh monthly high (0.7283) following the larger-than-expected uptick in US Non-Farm Payrolls (NFP), but the break above the May high (0.7266) raises the scope for a further advance in the exchange rate as it tests the 50-Day SMA (0.7227) for the first time since March.
Technical Forecast for Australian Dollar: Neutral
AUD/USD appreciates for three consecutive weeks after reversing ahead of the June 2020 low (0.6648), with the failed attempt to break/close below the Fibonacci overlap around 0.6770 (38.2% expansion) to 0.6820 (50% retracement) pulling the Relative Strength Index (RSI) out of oversold territory.
AUD/USD Rate Daily Chart
Source: Trading View
In turn, AUD/USD pushed above the 50-Day SMA (0.7227) for the first time since March as it cleared the May high (0.7266), and the exchange rate may continue to retrace the decline from the April high (0.7661) if it manages to hold above the moving average.
The break above the 0.7260 (38.2% expansion) region may push AUD/USD back towards the overlap around 0.7370 (38.2% expansion) to 0.7440 (23.6% expansion), with the next area of interest coming in around 0.7560 (50% expansion) to 0.7570 (78.6% retracement).
However, lack of momentum to hold above the 50-Day SMA (0.7227) may bring the 0.7130 (61.8% retracement) to 0.7180 (61.8% retracement) region back on the radar as the moving average reflects a negative slope, with the next area of interest coming in around 0.7070 (61.8% expansion) to 0.7090 (78.6% retracement).
--- Written by David Song, Currency Strategist
Follow me on Twitter at @DavidJSong
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.