Bullish Momentum: AUDUSD holds above key moving averages

<p>Today, the AUDUSD has moved up from a swing area support between 0.6445 and a 0.6455 (see red numbered circles on the chart below). The subsequent move to the upside took the price back above its 100-day moving average of 0.64874 (blue overlay line on the chart below). That moving average is – and remains – a key barometer for both buyers and sellers. Staying above that moving average is more bullish. Moving back below there and is likely disappointment on the inability to once again stay above that key moving average level.</p><p>What would give the buyers even more confidence going forward is a move back above the 38.2% retracement of the move down from the July high to the October low. That retracement level comes in at 0.65086. </p><p>When there is a trend-like move to the downside (from the July high). Getting and staying above the 38.2% retracement is required to show the buyers can take more control. </p><p>Last week, the price moved above the 38.2 and 100-day moving average near the same level but stalled against the high of a swing area at 0.65229. </p><p>This week the price also moved above the 38.2% retracement on the momentum after the CPI surprise on Tuesday. This time the price also extended above the high of the swing area at 0.65229. That should have propelled the price higher toward the 50% midpoint at 0.65824. However momentum faded, and the price moved back into the swing area and back below the 38.2% retracement and 100-day moving average as well. Buyers turned to sellers as a bullish bias was weakened.</p><p>However, with the support holding against the swing area near 0.6450 (green numbered circles) and as we move toward the end of the week, the buyers are making apply with the move back above the 00-day moving average. The bullish work is not complete, however. Getting above the 38.2% retracement is the next key target. If it can be broken and the high swing area at 0.65229 is also broken, the hopes for a move toward the 50% midpoint and 200-day moving average would be a strong possibility.</p>

This article was written by Greg Michalowski at www.forexlive.com.