Forex: AUD/USD Technical Analysis – Short Position Still in Play
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- AUD/USD Technical Strategy: Short at 0.90
- Support: 0.8919 (14.6% Fib exp.), 0.8821 (23.6% Fib exp.)
- Resistance: 0.9051-85 (Jan 13 close and high)
We entered short AUD/USD last week as the pair formed a bearish Evening Star candlestick pattern, suggesting a top may be in place in the 0.9051-85 area (marked by the January 13 closing and swing highs). Downside follow-through has proven lacking thus far, with prices oscillating just above our first objective at 0.8906 marked by the 14.6% Fibonacci expansion. A daily close below this boundary exposes the 23.6% level at 0.8807.We continue holding the trade for now as negative RSI divergence argues for weakness, manually activating a stop-loss if a reversal upward produces a daily close above 0.9085 and thereby invalidates the topping setup.
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.