AUDUSD Analysis – May 16, 2023

The AUDUSD pair has been entrenched in a downtrend since its peak at 0.6817, with the recent bounce from 0.6635 being viewed as a corrective consolidation within this overall downtrend. Traders should closely monitor the price action as the pair enters a phase of range trading between 0.6635 and 0.6740, which is expected to persist for the next few days.

As long as the 0.6740 resistance level holds, the bearish bias is likely to prevail, and the downtrend in AUDUSD could be expected to resume. A breakdown below the support level at 0.6635 would confirm the continuation of the downtrend, potentially triggering another downward move towards the 0.6570 level.

On the upside, a break above the 0.6740 resistance would suggest that the downside movement has potentially completed at 0.6635. Such a breakout would indicate a shift in market sentiment and could lead to another upward push in the AUDUSD pair towards the 0.6900 level.

In conclusion, the AUDUSD pair remains in a downtrend, and the recent bounce is viewed as a corrective consolidation. While range trading is expected in the short term, the overall bias remains bearish. Traders should closely monitor key support and resistance levels for potential breakout opportunities while remaining cautious in their trading approach.