The AUDUSD pair has recently broken decisively above a sideways pattern that had kept it range-bound for more than two months. This breakout has propelled the price to its highest level since January 2024, indicating a significant shift in market sentiment.
Despite the bullish momentum, oscillators are flagging overbought conditions, suggesting that the recent rally may be losing steam. Both the RSI and stochastics are indicating that the advance might be overstretched, increasing the risk of a potential pullback in the near future.
If the pair continues to march higher, the next significant resistance level lies at the December 2023 peak of 0.6870. Beyond that, the double top region of 0.6898 could act as a key hurdle for further upside movement. On the downside, immediate support is seen at the May resistance level of 0.6713, with further support at 0.6643 and 0.6618 in case of a deeper pullback.
The recent breakout of AUDUSD from its neutral range has provided a strong bullish momentum, pushing the pair to a fresh six-month high. However, with technical indicators suggesting overbought conditions and the possibility of a pullback, traders should exercise caution and closely monitor price action in the coming days. Keeping an eye on key resistance levels and support levels will be crucial in assessing the future direction of AUDUSD.