AUD/USD Price Analysis: Bullish Breakout On The Cards Or Have We Seen The Highs?

By Clay Webster of FXStreet

Where Forex Never Rests • Jan 15, 2023 at 5:54 PM EST

AUD/USD bulls are in control but there is a case for both the bulls and bears at this juncture. A break through the 0.6880s opens risk to 0.7050 and 0.7090 while a break below 0.6950 opens the risk of a move to 0.6870.

It's been a roller coaster of a ride to start the year and AUD/USD has been one of the most volatile love the past week, driven on fundamentals, both home and away. Nevertheless, the schematic is arguably bearish but there needs to be a break of 0.6870 to confirm the downside bias. Therefore, bulls are going to be looking for a drive through 0.7000 for the initial balance for the week as the following illustrates:

AUD/USD H4 chart

Firstly, a bearish outlook and schematic could be drawn as follows:

(Click on image to enlarge)

On a break of 0.6950, the trendline support could come under pressure in the coming sessions and if it were to give way, 0.6900 stops could trigger a slide towards 0.68 and below if 0.6870 breaks.

This falls in line with a bearish daily chart thesis:

(Click on image to enlarge)

AUD/USD upside bias, H4 chart

On the upside, an inverse head and shoulders could be forming:

(Click on image to enlarge)

A break through the 0.6880s opens risk to 0.7050 and 0.7090 for sessions ahead, in line with the bullish trend.

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