Credit: REUTERS/DANIEL MUNOZAug 27 (Reuters) - The Australian dollar could strengthen further as a major technical level comes under pressure.
An impressive bull trend has begun since AUD based at COVID-19 crisis lows in March, and barring further significant virus damage a cycle low is in place at 0.5510.
The weekly chart shows only three major pullbacks against the trend, which kicked off with a strong candle reversal signal in the week ending March 27.
Last week's failure to hold a 200-week moving average break triggered profit taking, but the 0.7275 to 0.7160 drop was quickly exploited by those wanting to join the trend.
The 200-week moving average, 0.7253, is again under pressure and a close above could open up a run to 0.7400 or even 0.7500 by year-end. The market last closed above the long-term average in April 2018 and a subsequent bear market lasted into the March 2020 reversal.
Failure to extend the trend above the 200-week moving average could bring an Ichimoku cloud twist into play. The 0.6296-00 twist is value late November.
For more click on FXBUZ
AUD/USD weekly candle chart: https://tmsnrt.rs/32sX0T7
(Peter Stoneham is a Reuters market analyst. The views expressed are his own)
((peter.stoneham@thomsonreuters.com))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
