AUD/USD Price Analysis: Bulls going against the grain to M-formation neckline target
|- AUD/USD bulls step in and target the daily M-formation neckline as the greenback slides.
- DXY is testing 96 the figure ahead of the Fed.
As per prior analysis at the start of the week, AUD/USD Price Analysis: Bears move the Aussie to the edge of the abyss, the price has advanced towards an identified daily target area in recent trade.
AUD/USD, prior analysis
It was started that ''AUD/USD's M-formation on the daily chart is a compelling chart pattern for the week ahead.''
AUD/USD live chart
As illustrated, the bulls have homed in n the neckline of the M-formation in trade today. This has occurred in a sharply hourly bullish impulse as follows:
The bullish impulse may not be over yet, but a correction could be in order back towards the prior resistance that has a confluence with the 38.2% Fibonacci retracement of the recent rally that meets with the 10-EMA.
The move has occurred as the US dollar sinks to test deeper liquidity and 96 the figure in the DXY index, breaking prior resistance and support as follows:
However, considering how fluid geopolitics are, if there is a Russian invasion of Ukraine, the US dollar would be expected to continue higher. In turn, this would be taking the Aussie down with it for a test of bullish commitments in the lower end of the 0.70 areas.
Additionally, the M-formation is a reversion pattern, so a move higher in the greenback could infold in coming hours as markets get set for the Federal Reserve.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.