AUD/USD Technical Analysis: Bottom Found Above 0.85
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- AUD/USD Technical Strategy: Flat
- Support:0.8659, 0.8531, 0.8441
- Resistance:0.8743, 0.8869, 0.8970
The Australian Dollar turned upward as expected against its US namesake after producing a Bullish Engulfing candlestick pattern. Near-term resistance is at 0.8743, the 23.6% Fibonacci retracement, with a break above that on a daily closing basis exposing the 38.2% level at 0.8869. Alternatively, a turn back below the January 2014 lowat 0.8659 clears the way for a test of the 50% Fib expansion at 0.8531.
Prices are too close to resistance to justify entering long from a risk/reward perspective. On the other hand, the absence of a defined bearish reversal signal suggests that taking up the short side is premature. With that in mind we will remain flat for now.
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Daily Chart - Created Using FXCM Marketscope 2.0
--- Written by Ilya Spivak, Currency Strategist for DailyFX.com