Open an Account
☰
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 76% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Open an Account
✖

AUDUSD Six Technical Reasons to Be Bullish Here

Article By: ,  Head of Market Research
January 6, 2020 10:11 AM

After starting the first full week of the new year in a decidedly “risk off” position, markets are recovering into the US session close.

For FX traders, the Australian dollar has long been the quintessential pro-growth currency, at least among the developed market majors, and the price action so far this year has borne that out. After breaking out above horizontal support-turned-resistance in the 0.6925 area at Christmas, AUD/USD surged above the 0.7000 level to trade above 0.7030 on New Year’s Eve. Since then though, escalating tensions in the Middle East, stoked by the US bombing of an Iranian commander, have taken the wind out of AUD/USD bulls’ sails and taken AUD/USD back to its initial Christmas breakout level near 0.6925:

Source: TradingView, GAIN Capital

While there are still potential causes for concern, the pullback we’ve seen since New Year’s Day could provide an excellent opportunity for bulls who missed the initial breakout to join the newly established uptrend, for at least six distinct technical reasons:

  1. AUD/USD is testing the key 0.6925, which has served as reliable support/resistance for the last six months.
  2. After spending every day of the last 21 months below its 200-day moving average, AUD/USD has definitively broken above that long-term trend measure.
  3. Price remains within a rising channel off the November lows.
  4. There’s an equivalent rising channel in the RSI indicator, signaling growing buying pressure.
  5. The RSI indicator has pulled back from overbought” territory (>70), potentially opening the door for another leg higher.
  6. The MACD indicator is trending higher above both its signal line and the “0” level, showing strong bullish momentum.

As long as prices remain above the support corridor between the key 0.6925 level and the 200-day MA at 0.6900, the technical bias remains higher for a possible test of July’s high at 0.7075. Even with the bullish technical signs cited above, a break below this key zone would open the door for a deeper retracement toward 0.6800.

The information on this web site is not targeted at the general public of any particular country. It is not intended for distribution to residents in any country where such distribution or use would contravene any local law or regulatory requirement. The information and opinions in this report are for general information use only and are not intended as an offer or solicitation with respect to the purchase or sale of any currency or CFD contract. All opinions and information contained in this report are subject to change without notice. This report has been prepared without regard to the specific investment objectives, financial situation and needs of any particular recipient. Any references to historical price movements or levels is informational based on our analysis and we do not represent or warranty that any such movements or levels are likely to reoccur in the future. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness, nor does author assume any liability for any direct, indirect or consequential loss that may result from the reliance by any person upon any such information or opinions.

Futures, Options on Futures, Foreign Exchange and other leveraged products involves significant risk of loss and is not suitable for all investors. Losses can exceed your deposits. Increasing leverage increases risk. Spot Gold and Silver contracts are not subject to regulation under the U.S. Commodity Exchange Act. Contracts for Difference (CFDs) are not available for US residents. Before deciding to trade forex, commodity futures, or digital assets, you should carefully consider your financial objectives, level of experience and risk appetite. Any opinions, news, research, analyses, prices or other information contained herein is intended as general information about the subject matter covered and is provided with the understanding that we do not provide any investment, legal, or tax advice. You should consult with appropriate counsel or other advisors on all investment, legal, or tax matters. References to FOREX.com or GAIN Capital refer to StoneX Group Inc. and its subsidiaries. Please read Characteristics and Risks of Standardized Options.

FOREX.com is a registered FCM and RFED with the CFTC and member of the National Futures Association (NFA # 0339826). Forex trading involves significant risk of loss and is not suitable for all investors. Full Disclosures and Risk Warning. Increased leverage increases risk.

GAIN Capital Group LLC (dba FOREX.com) 30 Independence Blvd, Suite 300 (3rd floor), Warren, NJ 07059, USA. GAIN Capital Group LLC is a wholly-owned subsidiary of StoneX Group Inc.

© FOREX.COM 2025