The AUDUSD reached it’s high for the week on Monday when the pair rallied but stalled against a downward sloping channel trendline.
That channel followed the price down to a low on Tuesday before the market started to consolidate into the CPI data on Thursday. The lows on Tuesday and Wednesday stalled between 0.6237 and 0.62487.
The high price on Thursday – before the CPI – found sellers against its 100 hour moving average (blue line in the chart above). The stronger than expected CPI sent the price tumbling to the downside and below the aforementioned floor area from Tuesday and Wednesday between 0.6237 and 0.62487.
Of course, the big squeeze was on after the CPI which forced the price of the AUDUSD back higher and above its falling 100 hour moving average.
In trading today the momentum to the upside was continued. However when the price reached the high from Tuesday, sellers reentered and stalled the pair near the 0.6346 area. The ceiling was set.
Since then sellers have been able to push the price back below the 100 hour moving average and more recently below the lower swing area from Tuesday and Wednesday between 0.6237 and 0.62487. That area is now close risk. Stay below is more bearish.
On the downside, the next target comes against the low from Thursday’s trade at 0.6169. That low was the low for the year and the lowest level since the week of March 22, 2020.