AUD/USD Price Analysis: Bulls retain control near multi-week tops, eyeing 0.7400 mark

• AUD/USD gained traction for the third successive day and shot to fresh multi-week tops.
• Overbought RSI (14) on hourly charts warrants some caution for aggressive bullish traders.
• A sustained move beyond the 0.7415-20 supply zone should pave the way for further gains.

A combination of factors pushed the AUD/USD pair higher for the third successive session on Thursday. The momentum extended through the first half of the European session on Thursday and pushed the pair to four-week tops, closer to the 0.7400 mark in the last hour.

The US dollar languished near one-month lows amid expectations that the Fed would wait for a longer period before deciding to roll back its massive pandemic-era stimulus. This, along with better-than-expected Australian data and the prevalent risk-on mood, acted as a tailwind for the perceived riskier aussie.

Looking at the technical picture, the overnight move back above an important horizontal support breakpoint turned resistance, around the 0.7330 region, which was seen as a key trigger for bullish traders. This, in turn, assisted the AUD/USD pair to build on its recent strong rebound from the 0.7100 mark, or YTD low.

Meanwhile, technical indicators on hourly charts are already flashing overbought conditions. Hence, any subsequent positive move beyond the 0.7400 round-figure mark is likely to confront stiff resistance and remain capped near the 0.7415-20 supply zone. The mentioned area marks the top boundary of a congestion zone.

That said, oscillators on the daily chart have just started gaining positive traction and support prospects for additional gains. A sustained move beyond the 0.7415-20 region will reaffirm the outlook and trigger a fresh bout of a short-covering, pushing the AUD/USD pair towards the key 0.7500 psychological mark.

On the flip side, any meaningful pullback now seems to find decent support near the 0.7335-30 region. This is followed by the 0.7300 mark, which if broken decisively might shift the bias in favour of bearish traders. The AUD/USD pair might then accelerate the corrective slide towards the 0.7235 horizontal zone.

AUD/USD daily chart

Technical levels to watch