Previous: AUD/USD is Breaking Above July’s Declining Trendline (7/16)

AUD/USD 1H Chart 7/18/2012 10:50AM EDT

The AUD/USD continues to trade in an upwards channel seen in the 1H chart. It just pushed through July’s high at 1.0327, and into highs now seen since the beginning of May 2012. The RSI has been tagging 70 and remaining above 40, a sign of persistent momentum, but we already can tell by the way the market is trading in an upwards channel.

At this point a drop below 1.03 is needed to break the rising channel support. While it continues to channel up, the next key resistance pivot is at 1.0470, which is the high from April 27-30, 2012.

As the bull run extends, it should be noted in the daily chart that the AUD/USD is in a sideways market, and the further away from mean price action, the more tendency it has to revert back to it. In the daily chart, the mean can be interpreted as the 200-day SMA, which is near 1.03.

AUD/USD Daily Chart 7/18/2012 10:55AM EDT

Fan Yang CMT is a forex trader, analyst, educator and Chief Technical Strategist for FXTimes – provider of Forex News, Analysis, Education, Videos, Charts, and other trading resources.

Information and opinions contained in this report are for educational purposes only and do not constitute an investment advice. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness. FXTimes will not accept liability for any loss of profit or damage which may arise directly, indirectly or consequently from use of or reliance on the trading set-ups or any accompanying chart analysis.