AUDUSD falls to swing area support ahead of May/June extremes

The  AUDUSD  rallied higher yesterday along with the other dollar selling trends in the major currency pairs. However, once the pair reached the 200 hour moving average and 50% retracement near 0.7066, sellers leaned and the price started wandering back to the downside.

Today in the Asian session, the 38.2% retracement at 0.7015 was tested and then broken. Then in the US session, the 100 hour moving average and swing area between 0.69489 and 0.6962 was broken leading to another run toward the lower swing area between 0.68916 and 0.69168.

That swing area is ahead of the May and June extremes that took the price down to 0.6829 on May 12, and 0.68499 during Tuesday’s trade this week. Support buyers have been lean against that swing area (see red numbered circles).

What now?

There are dip buyers in the aforementioned swing area and the price has ticked back above the upper end of that area. Resistance remains at the 0.69489 and the 100 hour moving average at 0.69563. Should that area be tested I would expect that sellers would look to keep a lid on the pair with stops on a break above.

On the downside, move back into the swing area and below the lower extreme at 0.68916, and the low for the week at 0.68499, and the low from May are the major targets to get to and through.

Of interest as well is that for the week, the AUDUSD closed at 0.70405 last Friday. The high was at 0.70685. The low was at 0.68499. The midpoint of the week’s trading range is right around the 100 hour moving average at 0.6959 (the 100 hour moving averages at 0.69563).

That increases the areas importance from a bias defining level (between 0.6956 and 0.6959).

Stay below is more bearish. Move above is more bullish.