**AUD/USD Technical Analysis: Struggling to Sustain Momentum Above Key Swing Area**
*Inspired by the original analysis by Greg Michalowski for InvestingLive.com. Additional market context and analysis included.*
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The AUD/USD currency pair, a major barometer of risk sentiment and global economic trends, recently found itself grappling with technical resistance after briefly pushing above a key swing area. Despite posting gains, the pair failed to sustain upward momentum as market dynamics shifted and traders weighed changing fundamental drivers.
This article offers an in-depth analysis of the AUD/USD’s recent price action, dives into technical and fundamental factors influencing the pair, and considers potential scenarios moving forward. Traders and investors alike can utilize this comprehensive breakdown to inform their strategies, whether for short-term trades or longer-term positions in the forex market.
**I. Overview of Recent Price Action**
– **Attempted Rally:** AUD/USD moved higher, stretching above a notable swing area on the charts, enticing some buying interest.
– **Lack of Follow-through:** Despite the breakout, the pair couldn’t maintain strength, quickly losing steam and retreating below the established resistance zone.
– **Key Swing Area:** This region had served as a crucial barrier in recent sessions, repeatedly capping upside moves. Technically, a confirmed break above could have sparked additional buying and paved the way for higher targets.
**II. Technical Analysis Breakdown**
1. **The Swing Area: Identification and Significance**
– The swing area refers to a band of price levels where the AUD/USD encountered resistance multiple times across recent trading sessions.
– According to the analysis on InvestingLive.com, this zone lies around 0.6675 to 0.6690.
– Each attempt to breach this area had been met with selling pressure, reflecting strong interest from sellers to defend these levels.
2. **Breakout Attempt and Rejection**
– In the latest move, the pair managed to probe above this swing area intraday.
– However, a lack of momentum—possibly due to profit-taking or limited follow-through from buyers—saw the price quickly fall back, highlighting the resilience of this technical ceiling.
– Chart watchers often look for a daily close above resistance to confirm a bullish breakout, but in this case, AUD/USD was unable to deliver.
3. **Short-term Support and Pivot Levels**
– As the rebound faltered, traders are now eyeing short-term support zones to gauge if the pullback will accelerate or stabilize.
– Potential areas of interest include:
– The rising 200-hour moving average, which can serve as dynamic support.
– Recent swing lows around 0.6640 and deeper levels near 0.6600, representing psychological and technical pivots.
4. **Oscillators and Momentum Indicators**
– Momentum studies such as Relative Strength Index (RSI) and MACD can help traders assess overbought or oversold conditions.
– In this scenario, RSI readings suggest the pair
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