Forex: AUD/USD Technical Analysis – Rejected Above 0.90 Figure
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- AUD/USD Technical Strategy: Flat
- Support: 0.8910-35 (trend line, 23.6% Fib ret.), 0.8807 (23.6% Fib exp.)
- Resistance: 0.9079 (38.2% Fib ret.), 0.9208 (50% Fib ret.)
The Australian Dollar rebounded as expected after prices produced a bullish Piercing Line candlestick pattern. Prices are now pulling back from resistance at 0.9079 to test support in the 0.8910-35 area, marked by a recently broken falling trend line and the 23.6% Fibonacci retracement. A break downward aims for the 23.6% expansion at 0.8807. Alternatively, a reversal above 0.8918 exposes the 38.2% retracement at 0.9079.
A short position at current levels looks unattractive from a risk/reward perspective as prices trade squarely at relevant support. On the other hand, a long trade seems premature absent confirmation of reversal. On balance, we will remain on the sidelines for now.
Daily Chart - Created Using FXCM Marketscope 2.0
--- Written by Ilya Spivak, Currency Strategist for DailyFX.com
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.