As the world’s top investment manager and financial market journalist, I am closely monitoring the AUD/USD pair as it teeters on a critical level for the uptrend. The recent peak of 0.6824 on August 29 has sparked both optimism for a continued uptrend and concern for a potential reversal.
The current correction, a three-wave structure resembling an ABC correction, suggests a temporary counter-trend reaction before the uptrend resumes. The key level to watch is 0.6800 – a close above this level could signal a continuation of the uptrend towards the 0.6824 high and beyond.
AUD/USD 4-hour Chart
However, a downside extension could challenge this hypothesis and indicate a potential shift to a new downtrend. Confirmation would come with a close below 0.6751, followed by a move towards 0.6700-05 and the 200-period Simple Moving Average (SMA).
The current sideways range of AUD/USD, retesting resistance at the top like in July, suggests a possible trend reversal. The Relative Strength Index (RSI) shows strong bearish momentum, hinting at a potential decline from the recent high.
Analysis:
The AUD/USD pair is at a critical juncture, with the potential for both a continuation of the uptrend or a reversal towards a downtrend. Traders should closely monitor the key levels of 0.6800 and 0.6751 for confirmation of the next market direction. The RSI indicator signals bearish momentum, indicating a possible pullback from recent highs. Stay informed and make strategic decisions based on market trends to optimize your financial outcomes.