Consolidates near the highs
The AUDUSD tested a topside trend line in the run up yesterday. That trend line (it is the topside channel trend line actually) was actually broken by about 5 pips, but the market tired at the key technical level, and the late day dollar buying sent the pair down too.
Where did it go?
The price fell to the 100 hour MA (blue line) and a swing area at 0.7939. That dual support level, stalled the fall. That stall came AFTER what was a pretty good employment report out of Australia.
The ability to hold support (and have good fundamentals), keeps the buyers in control. The price currently trades at 0.7990 area.
Going foward, the "market" will mark the 100 hour MA as key support. They will also have the 0.7939 level as a key line in the sand. Stay above those technical levels will help to drive a more bullish bias. Move below, and the trend move higher will likely see some further correction potential.
What about the upside?
The obvious target is the topside trend line. That line continues to move higher. So bulls will be chasing it. However, it has been a ceiling in the past, and I would expect sellers to lean on tests in the future.
Drilling to the 5- minute chart the pair has been rising in its own channel from the low. The price just tested the low trend line, after testing the higher trend line about an hour or so ago.
SUMMARY: Technical levels are defining the ranges intraday and also from the longer hourly chart. The bias is supportive, but there are also limits to the upside. Take the clues from the levels. They help tell you what the overall "market" is thinking from a bullish or bearish perspective.
