Forex Technical Update

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AUD/USD 4H Chart 8/1/2012 6:55AM EDT

AUD/USD 8/1/2012 4H chart

The AUD/USD pushed through the 1.05 handle during the 7/31 session and continues to trade up with the rising channel resistance. The 4H chart shows the AUD/USD stay above 1.0450 and push to 1.0540, a new high for the day.

So far in the 4H chart, the RSI remains bullish, but it may be start to show bearish divergence if the 1.0540/1.0550 level holds during early US session. Some scale stabilizing could be anticipated ahead of the FOMC announcement at 2:15PM EDT.

When we look at the 1H chart, we see that the new high comes with a lower momentum as the RSI reading failed to push back to 70. Instead if it falls back below 60 toward 40, price action is likely to be in ranging mode, fitting a slowdown ahead of the FOMC meeting.

For topping and reversal consideration, the 1.045 level is a key pivot to break. This opens up the 1.0380 pivot, where the 200-H SMA resides as well.

AUD/USD 1H Chart 8/1/2012 6:57AM EDT

AUD/USD 8/1/2012 1H chart

Fan Yang CMT is a forex trader, analyst, educator and Chief Technical Strategist for FXTimes - provider of rex News, Analysis, Education, Videos, Charts, and other trading resources.

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