AUDUSD Gains Traction for the 2nd Day in a Row As the Dollar Weakens

AUDUSD Gains Traction for the 2nd Day in a Row As the Dollar Weakens

AUDUSD Price Analysis – July 22

During the early European session, the AUDUSD pair soared to fresh weekly highs, hovering around the 0.7387 level. The pair recovered positive traction for the second consecutive session, and it is now attempting to build on the previous day’s impressive recovery from sub-0.7300 levels. The risk-on sentiment weakens the dollar and boosted the perceived riskier Australian dollar.

Key Level
Resistance Levels: 0.7600, 0.7500, 0.7414
Support Levels: 0.7300, 0.7200, 0.7100
AUDUSD Long term Trend: Ranging
From a technical standpoint, the recovery from the low level of 0.7289 propelled the pair towards the psychological level of 0.7400 short of 13 pips. The rebound constituted the construction of an upside continuation chart pattern, given the recent steep pullback from the important 0.7598 levels or July high.

On the other hand, weakness below the weekly swing lows, around the 0.7289 zones, could confirm the retracement setup and drag the pair back to the 0.7220 levels. Some follow-through selling should pave the way for a further depreciating move in the near term, en route to the 0.7000 round-figure marks and support zone.
AUDUSD Short term Trend: Ranging
On the 4-hour time frame, the AUDUSD trend is unchanged, and the intraday bias initially remains at the downside channel. The fall from the 0.7598 level might continue, with a test of the 0.7289 temporary low near the rising trendline support. However, as long as the 0.7300 confluence level holds, the trend could continue to be optimistic.

On the upside, a break above the minor resistance level of 0.7414 might shift the bias to the upside, allowing for a retest of the 0.7598 level. The break may signal the start of a larger rally from 0.7000. In the meanwhile, a definitive violation of the 0.7300 zones might trigger a steeper decline.

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Author : Azeez Mustapha

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Azeez Mustapha is an experienced author, trader, markets analyst, signals strategist, and funds-manager.