AUD/USD Price Analysis: Stretched consolidation near 0.7500 signals an inventory adjustment

• Elongated consolidation near a five-month high is indicating an inventory adjustment.
• Flat 20 and 50-period EMAs are signaling a lackluster move.
• Aussie bulls can take control if the asset oversteps 0.7540.

The AUD/USD pair is witnessing an escalated consolidation after printing a yearly high at 0.7540. Aussie bulls seem to fail to sustain above 0.7500 and have displayed multiple failed attempts on breaching the yearly highs.

On a four-hour scale, AUD/USD is oscillating in a range of 0.7460-0.7540 from the last week. Usually, an elongated oscillation after a firmer rally indicates an inventory adjustment in which the institutional investors shift their inventory to the retail participants.

The 20 and 50-period Exponential Moving Averages (EMAs) at 0.7495 and 0.7475 have turned horizontal, which signals a consolidation in the asset.

While the momentum oscillator, Relative Strength Index (RSI) (14) has shifted into a range of 40.00-60.00 from a bullish range of 60.00-80.00 indicating a lackluster move going forward. Also, the aussie bulls have lost their strength.

A slippage below March 29 low at 0.7455 will drag the asset towards March 10 high at 0.7369, followed by the round level support at 0.7300.

On the flip side, aussie bulls can dictate the price if the asset oversteps March 28 high at 0.7541, which will drive the pair towards the round level resistance at 0.7600, followed by the 17 June 2021 high at 0.7646.

AUD/USD four-hour chart