AUDUSD Technicals: The AUDUSD bounces off swing space and strikes as much as 200 day MA

The AUDUSD is caught in a technical sandwich. Buyers found a floor at a key long-term swing area, but the recovery rally has run smack into a wall of resistance against a key MA. .

If you look at the 4-Hour chart of the AUDUSD, you can see the technical battle lines are clearly drawn.

The Support: Buyers Lean Against the August Lows
Earlier in the day, the price extended lower, and tested the resolve of the sellers and the courage of the buyers. It found that buyers courage at the major swing area between 0.6407 and 0.6424 (in reality, risk be defined and limited at the swing area – see the red numbered circles).

Why is this level important?

1. It represents the lows not just for today or this week, but it stretches back to the lows going as far back as May and again in August.

2. The price bottomed out precisely at 0.6420, right in the middle of that yellow swing area, before buyers stepped in to rotate the price higher.

That 0.6407 – 0.6424 area is now the definitive “floor.” As long as the price stays above that, the buyers have a shot at a correction.

The Resistance: The 200-day MA Barometer
The bounce off the lows was decent, but it has now reached a critical “make or break” point on the topside. The rally has taken the price right back to the 200-day moving average (the overlayed Green Line).

• The Level: The 200-bar MA comes in at 0.64591.

• The Swing Zone: This moving average is currently cutting through a swing area between 0.64578 and 0.6462.

You can see the price wicking right into this zone and stalling. This Green Line was broken earlier this week—signaling a bearish shift—and now it is being tested from below as resistance.

The Verdict
The market is telling us clearly where the risk lies.

• For Sellers: You are leaning against the 0.6458 – 0.6462 area and the 200-bar MA. If the price holds here, the trend remains bearish, and a rotation back toward the lows is the play.

• For Buyers: You need to see a break above that Green Line and the 0.6462 level to prove that the low at 0.6420 was a true bottom. Until then, this is just a correction in a bearish move.

Watch the close. A move above the 200-bar MA changes the bias. A failure here keeps the bears in control.