The AUDUSD price has been moving sideways on a lower time frame close to a ley support level. Will the price hit this level or will the price reverse?
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The price of AUDUSD is ranging close to a key support level of 0.6100. Fundamentally the price is more likely to trade lower due to the opposing central bank outlooks. The RBA are slowing down the pace of tightening and in their recent meeting only hiked by 25bps disappointing investors. However, the Federal Reserve is looking to hike by 50-75bps for a longer period of time which could keep the USD stronger for longer. Also the risk in the market has increased with stocks falling which puts pressure on risk assets like the AUD.
Looking at the chart we can see from the monthly and weekly time frame we are in an impulsive phase of a downward trend. In this scenario we would expect the daily and 4hr time frame creating lower highs and lower lows. That is what we are witnessing at the moment, on the 4hr time frame we can see some more information. Price before this recent consolidation also consolidated for a period of time before breaking to the downside. Could this happen again as the price seems to be following a similar pattern? If it does and the price breaks through the minor supporting trendline we could look for short term short opportunities to the major 0.6100 level.
Did you see our GBPJPY Analysis? You can see it here.
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