AUDUSD Weekly Analysis – May 21, 2023

The AUDUSD currency pair is currently experiencing a period of consolidation as it navigates within a defined range. Traders are closely monitoring this range, as it provides insights into the potential future direction of the pair.

It is worth noting that this consolidation phase is occurring within the context of a long-term downtrend from 0.8006. As long as the price remains below the falling trend line on the weekly chart, there is a likelihood that the downtrend will resume. This suggests that any upward moves during the consolidation phase may be considered as corrective in nature rather than a reversal of the overall downtrend.

The range trading between 0.6170 and 0.7157 is expected to persist over the next several weeks. Traders should pay close attention to key support and resistance levels within this range to identify potential trading opportunities. A breakdown below the 0.6560 support level could pave the way for further downside movement towards the 0.6170 support.

On the upside, a significant breakthrough of the resistance at 0.6800 would be required to shift the near-term sentiment. Such a move could potentially bring the price towards the 0.7157 resistance level, followed by the falling trend line. It is important to note that breaking above the trend line resistance would provide a stronger signal of a potential trend reversal or a more significant upward correction.

In conclusion, the AUDUSD pair is currently consolidating within a defined range as the long-term downtrend from 0.8006 persists. Traders should closely monitor the price’s behavior relative to the falling trend line and key support and resistance levels within the range. A breakdown below 0.6560 could indicate a resumption of the downtrend, while a breakthrough above 0.6800 would suggest a potential shift in sentiment. Stay attuned to market developments and adjust trading strategies accordingly.