AUDUSD Holds On to Gains Beyond 0.7100 Level As Hopes for Additional US Fiscal Stimulus Allays Investor Fears

AUDUSD Holds On to Gains Beyond 0.7100 Level As Hopes for Additional US Fiscal Stimulus Allays Investor Fears

AUDUSD Price Analysis – October 8

On Thursday, the AUDUSD pair gained momentum and increased to a daily high of 0.7171 after holding on to gains beyond the level of 0.7100. The revived hopes for the next round of US fiscal stimulus measures, while alleviating investor concerns, remained supportive of the prevailing upbeat market sentiment.

Key Level
Resistance Levels: 0.7413, 0.7350, 0.7209
Support Levels: 0.7100, 0.7003, 0.6832
AUDUSD Long term Trend: Ranging
The swings in US equities continue to affect AUDUSD, which in turn holds political news intensely. A difficult resistance for the Aussie is established by the 0.7200 area. Annihilating this, and before confronting the multi-month high of 0.7413 level, the nearby horizontal barrier may exceed the high level of 0.7350.

In the wider sense, while the rebound from the level of 0.5506 was impressive, there is still insufficient evidence to support the bullish trend reversal. That is, within the long-term upward trend, it may be just a correction as emphasis would be turned back to a low 0.5506 level.
AUDUSD Short term Trend: Ranging
Today, AUDUSD decreases dramatically but rebounds after breaching a minor support level of 0.7100. First, intraday bias stays impartial. The rebound from the 0.7005 level may restart on the upside, breaching the resistance level of 0.7209. That will also mean the completion of the 0.7413 level correction.

In this scenario, the further rally may be seen to retest the high level of 0.7413. Nevertheless, on the downside, the firm breach of the 0.7100 level may suggest that the correction from the level of 0.7413 is restarting. Intraday bias at 0.7005 level would be shifted back to the downside, and then retracement of 38.2 percent from 0.5506 to 0.7413 at 0.6685 levels.

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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.