The AUD/USD pair reverses an intraday dip to sub-0.6700 levels and climbs to a fresh daily high heading into the North American session on Thursday. Spot prices, however, remain below a technically significant 200-day Simple Moving Average (SMA) and currently trade with only modest intraday gains, around the 0.6720 region.

The orderblock on daily still persists around 0.6800 and the Aussie Dollar is not showing any signs of bullish breakout above the OB levels. The DEMA50&200 are also acting as a strong resistance to the pair and the momentum seems to be not enough for providing a breakout through.  

According to the elliot wave pattern, AUDUSD is hovering within the wave 4 correction of the cycle and primary degree of previous bearish impulsive wave 3. Which means the redistribution according to the smart money concept is causing accumulation below 0.6800. An expected 5th bearish impulsive wave can take place by Friday closing this week or mid next week to complete the cycle. Afterwards there might be a correction of higher degree onto the bullish side takes place to determine either continuation to bullish trend or a bearish pullback. 

AUD/USD is auctioning in an Inverted Flag chart pattern which is a trend continuation pattern in which a long consolidation is followed by a breakdown. Usually, the consolidation phase of the chart pattern serves as an inventory adjustment in which those participants initiate shorts, which prefer to enter an auction after the establishment of a bearish bias and current sellers add more positions.

The 200-period Exponential Moving Average (EMA) at 0.6806 is acting as a barricade for the Australian Dollar bulls.

Meanwhile, the Relative Strength Index (RSI) (14) is hovering in the 40.00-60.00 range, signaling an absence of a potential trigger.

AUDUSD still bearish below 0.6806 levels

Apr 20 2023