AUD/USD Bounces Off From Horizontal Support As It Heads For 0.6600
AUD/USD currency pair has bounced off from its 4-month low near 0.6565 price level. Since this level was a multi-month low, it was also acting as a strong support zone. Normally, it is not usual for buyers to place big around the support zones, and that's what we saw in the case of AUD/USD.
It appears that the Australian Dollar/US Dollar pair is now heading toward the 0.6600 resistance level. At the time of writing this, the pair was trading near the 0.6595 level.
Now what remains to be seen is whether the Australian Dollar will cross the 0.6600 resistance with good momentum or will get rejected. If we look at the current fundamental docket, the USD is at full strength after Powell's recent speech.
AUD/USD Technical Analysis
It appears that Aussie Dollar was pushed higher from its multi-month lows, which also acted as support. This comes at a time when the AUD registered one of its biggest losses in almost a month.
Besides the support line, which is pushing the AUD higher, another indicator that is hinting toward the upside is the RSI (14) which shows oversold readings.
Although an oversold RSI rating is also an indication of strong bearish pressure, we can't ignore that it is also used as a reversal signal.
Beyond the 0.6600 resistance level, we also have the 0.6625 resistance that was once a support line last month. After that, the next hurdle for the Australian Dollar will be 0.6725.
In other words, the AUD/USD will get a lot of playing room if it can manage to cross 0.6625 with good momentum.
And if we look at the downside, a break of 0.6565 support line means that the AUD will lose further ground against the USD. In the case of a downside move, the AUD/USD can go toward an area between 0.6540 - 0.6520.
In a case where the pair even breaks the 0.6520 support, the next stop for the AUD/USD bears will be 0.6170, which is also the yearly's low!