The AUD/USD pair is trading above its upwards trend line a daily time frame. This confirms that the trend is biased towards the upside and as long as we stay above this trend line, the upward trend remain intact. However, the price has pierced the Bollinger band and it is trading well away from its 20 day moving average and this stipulates that the volatility is high. The piercing of the Bollinger band is taken as a sign by some traders that the price has moved well away from its mean and the current trend may pause or reverse, before it continues again. However, if this affair takes place near support or resistance zone, it elevates the importance of this theory.
The RSI has touched the over sold region and this calls for caution for any upside bias in the short term.
Important Zones
0.7656-0.7597 Major Resistance
0.7147-0.7101 Minor Support
0.7000-0.6962 Major Support
DISCLOSURE & DISCLAIMER: The above is for informational purposes only and NOT to be construed as specific trading advice. responsibility for trade decisions is solely with the reader.
By Naeem Aslam