Forex Strategy - AUD/USD Extends Declines Post Bearish Engulfing Formation
- AUD/USD Technical Strategy: Shorts preferred
- 0.9085 mark remains key resistance level (see daily chart)
- Bearish Engulfing pattern results in further declines
The Bearish Engulfing pattern on the four hour chart noted in yesterday’s candlesticks report has resulted in continued declines for the AUD/USD. The move lower comes following a test of the 0.9075 mark on some better-than-expected employment figures for Australia yesterday. Buying support may emerge near the 0.8890 mark.
AUD/USD: Bears Emerge
4 Hour Chart - Created Using FXCM Marketscope 2.0
It should also be noted that the recent recovery for the Aussie has resulted in a Hammer candlestick formation on the daily chart. While technically a bullish reversal signal, significant selling pressure remains at the 0.9085 mark which may continue to cap gains for the currency.
AUD/USD: Hammer Sees Little Follow-Through
Daily Chart - Created Using FXCM Marketscope 2.0
By David de Ferranti, Market Analyst, FXCM
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DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.