Forex Strategy - AUD/USD Awaits Reversal Confirmation at Key Resistance
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- AUD/USD Technical Strategy: Looking for longs on upside break
- Bullish Engulfing pattern results in further gains for the AUD/USD
- Warning from Gravestone Doji needs further confirmation
The Bullish Engulfing candlestick pattern on the hourly chart highlighted in yesterday’s report has resulted in extended gains for the AUD/USD. Following a test of the 0.9110 mark in intraday trade, the pair has now formed a Gravestone Doji candlestick which may be warning of potential declines. However, we have seen little follow-through and against the backdrop of an uptrend on the hourly, other technical signals would be necessary before offering a bearish bias.
The Piercing Line formation on the daily chart helped foreshadow the Aussie’s recent gains and continues to give a bullish signal. While we saw the AUD/USD edge out a new 2014 high by a few pips, the bulls appear to have lost momentum during Asian trading, thus a more convincing break is needed to suggest an advance towards the next level of resistance at 0.9160.
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Hourly Chart - Created Using FXCM Marketscope 2.0
Daily Chart - Created Using FXCM Marketscope 2.0
--- Written by David de Ferranti, Market Analyst, FXCM
Contact and follow David on Twitter: @Davidde
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