Forex Strategy: AUD/USD Gains In Question Following False Breakout
- AUD/USD Technical Strategy: sidelines preferred
- Dragonfly Doji may be hinting at an intraday recovery
- Bearish Engulfing pattern on the daily offers conflicting signal
As noted in yesterday’s candlesticks report the Gravestone Doji on the four hour chart was offering a warning signal for potential declines for the Aussie. However, following a plunge below 0.9100, a Dragonfly Doji during intraday trade may be hinting at a bounce in the session ahead.
4 Hour Chart - Created Using FXCM Marketscope 2.0
Getting some context from the daily chart (below), the Bearish Engulfing pattern that has arisen following the pair’s false break above 0.9085, suggests further declines may be possible for the AUD/USD. With the four hour and daily offering opposing cues for the currency, a neutral technical bias is offered.
AUD/USD: Retreat Offers Bearish Signal
Daily Chart - Created Using FXCM Marketscope 2.0
By David de Ferranti, Market Analyst, FXCM
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