AUD/USD Avoids NFP Volatility; Stalking Correction Rally
- Daily and 4H: Today, many USD and JPY pairs were volatile during the NFP release. However, AUD/USD did not, so it was unaffected by this event risk.
- The AUD/USD pair has corrected its downswing to 0.83 but has stalled at 0.85.
- Looking at the daily and 4H chart, this correction does not show significant strength relative to the prior downswing.
- The daily RSI shows that the momentum can still be indicative of an uptrend in the short-term. More likely, it is entering into a consolidation period. Possibly it will be entering a lower period of volatility after strong swings that started in May.
- Therefore, I put more probability in the market ranging in the month of July for AUD/USD, with upper resistnace at 0.8880 area, and lower support at the 0.8070 area.
- Looking at the 4H chart, there seems to be short-term bearish bias, but some near-term bullish attempt. Let's take a look at the 1H chart to see what we can expect near the start of next week.
- 1H: The 1H chart shows the market in a correction rally to 0.8500. It then entered into a flat pattern. If the market continues to rally, it can still be a correction from the decline from 0.8770 area.
- The RSI was held mainly below 60, and this rally would probably bring the RSI above.
- However, if the rally fails to pass the previous higher near 0.8580, there is a negative reversal, and we would have a strong bearish signal. The RSI high is higher than that on June 30, but the price high is lower than the price high on June 30. This suggests further bearish pressure.
- That is something to look out for at the start of next week.
Fan Yang Currency Analyst Commodity Trading Advisor
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