AUD/USD Classical 03.16
AUD/USD: Although the market has been very well supported on a medium-term basis ahead of 0.9800, we continue to favor risks for additional downside and like the idea of selling into any rallies. Ultimately, we see the market in the process of carving out a major top with the formation of what looks to be a very unconventional head & shoulders pattern. The neckline for this formation is highly debatable, but we will call 0.9800 as the neckline, with a weekly close below this figure to open the door for a severe decline back towards 0.9000 over the medium-term. Ultimately, only back above 1.0250 would negate and give reason for pause, while intraday rallies should be sold ahead of 1.0100.
Written by Joel Kruger, Technical Currency Strategist for DailyFX.com
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