AUD/USD Likely To Follow a Small Correction

#OPINIONLEADER# #Signal#

ByLCMS Traders FX Analysis Team

 JUN 21, 2021

AUD/USD dropped over 200 pips during the last week following FED’s hawkish policy statement on raising the interest rates. The pair is currently trading at 0.7497 with immediate support levels at 0.7478 and 0.7455. The intraday resistance levels are at 0.7515 and 0.7538.

On the weekly and intraday charts, the technical indicators are presenting a bearish picture. The SMA-14 is indicating resistance at 0.7666 and the SMA-50 resistance area is at 0.7723. The pair is also below the mid-Bollinger band while the upper and lower bands are at 0.7856 and 0.7519 respectively. The RSI is in the oversold zone while the MACD is below the zero line as well. However, the pair is currently trading just below the Fibo 50% support area which is generally used for reversal entries. Considering the RSI’s oversold zone and the Fibo’s buying zone the pair is likely to make a small correction before resuming the ongoing downtrend. Therefore a buy entry is ideal at the below levels

Direction: Buy

Entry: 0.7475

Take Profit Range: 0.7510 – 0.7530

Stop-Loss: 0.7448

An intraday closing below 0.7450 would end the possibility of a larger correction. On the upside, an intraday closing above 0.7540 would be supportive of the bulls and help them build a recovery pattern.