FxWirePro: AUD/USD spikes past 50-DMA, momentum bullish, stay long

Technical Analysis:

• AUD/USD has broken above 50-DMA at 0.7402 and intraday bias higher.
• Long-USD positions to be pared after Trump’s disappointing press conference.
• The pair has broken major channel top resistance at 0.7350.
• Momentum studies are bullish, strength in RSI at 61 levels with room for further upside.
• Upside in the pair pauses at 50% Fib (0.7778 to 0.7156 fall) at 0.7469. Next bull target is likely 200-DMA at 0.75.
• ADX has turned north, remains supportive for further upside. 
   

Fundamental Factors:

• The US dollar which has been on the back-foot, collapsed overnight on the back of Trump's lack of conviction.
• Markets which were looking for something concrete in respect to Trump's policies, were left largely disappointed.
   

TIME    TREND      OB/OS INDEX    

1H    Bullish        Neutral    
4H    Bullish        Overbought        
1D    Bullish        Neutral        
1W   Neutral        Neutral      
 
Support levels - 0.7429 (session low), 0.74, 0.7397 (50-DMA), 0.7381 (5-DMA), 0.73, 0.7288 (double bottom Jan 6th & 9th)

Resistance levels - 0.7469 (50% Fib of 0.7778 to 0.7160 fall), 0.75 (200-DMA), 0.7542 (61.8% Fib)

Call update: We had suggested a long in our previous call (http://www.econotimes.com/FxWirePro-AUD-USD-breaks-channel-top-resistance-on-track-to-test-50-DMA-at-07406-480320).

Recommendation: We recommend to initiate longs on dips around 0.7430/40, SL: 0.7390, TP: 0.7470/ 0.75/ 0.7540

FxWirePro Currency Strength Index: FxWirePro's Hourly AUD Spot Index was at 148.091 (Highly bullish), while Hourly USD Spot Index was at -69.9252 (Bearish) at 0210 GMT. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex.