Australia Dollar Outlook: AUD/USD
AUD/USD trades to a fresh monthly high (0.6748) despite the limited reaction to the Reserve Bank of Australia (RBA) Minutes, with the recent rally in the exchange rate pushing the Relative Strength Index (RSI) towards overbought territory.
AUD/USD Rally Pushes RSI Towards Overbought Territory
AUD/USD may continue to retrace the decline from the July high (0.6799) as it extends the recent series of higher highs and lows, and a move above 70 in the RSI is likely to be accompanied by a further advance in the exchange rate like the price action from last year.
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However, the RSI may mirror the behavior from last month should AUD/USD struggle to test the July high (0.6799) and snap the bullish price series carried over from last week.
AUD/USD Price Chart – Daily
Chart Prepared by David Song, Strategist; AUD/USD on TradingView
- AUD/USD stages a four-day rally as it extends the advance from the start of the week, with a close above 0.6740 (38.2% Fibonacci retracement) raising the scope for a test of the July high (0.6799).
- A break/close above the 0.6810 (23.5% Fibonacci extension) to 0.6820 (23.6% Fibonacci retracement) region opens up the January high (0.6839) but lack of momentum to close above 0.6740 (38.2% Fibonacci retracement) may curb the bullish price series in AUD/USD.
- Need a break/close below the 0.6590 (38.2% Fibonacci extension) to 0.6600 (23.6% Fibonacci retracement) area to bring the 0.6510 (38.2% Fibonacci retracement) to 0.6520 (23.6% Fibonacci retracement) zone on the radar, with the next region of interest coming in around 0.6380 (78.6% Fibonacci retracement) To 0.6410 (50% Fibonacci extension).
Additional Market Outlooks
US Dollar Forecast: USD/JPY Rebound Unravels Ahead of Fed Symposium
Canadian Dollar Forecast: USD/CAD Susceptible to Test of July Low
GBP/USD Forecast: Test of Weekly High in Focus
US Dollar Forecast: AUD/USD Bullish Price Series Persists
--- Written by David Song, Strategist
Follow on Twitter at @DavidJSong