AUD/USD Technical Analysis: Down Trend Ready to Resume?
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- AUD/USD Technical Strategy: Flat
- Support:0.8126, 0.8047, 0.7919
- Resistance:0.8254, 0.8369, 0.8472
The Australian Dollar rebounded against its US counterpart as expected after producing a Hammer candlestick reinforced by positive RSI divergence. A daily close above the 0.8241-54 area marked by the January 12 high and the 23.6% Fibonacci retracement exposes the 38.2% level at 0.8369. The appearance of a bearish Dark Cloud Cover pattern warns renewed weakness may be in the cards ahead. A turn below the 14.6% Fib expansion at 0.8129 clears the way for a challenge of the 23.6% threshold at 0.8047.
Risk/reward considerations argue against entering short with prices in close proximity to support. On the other hand, the absence of a defined bullish reversal signal suggests taking up the long side is premature. We will remain flat for now, waiting for a more actionable opportunity to present itself.
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Daily Chart - Created Using FXCM Marketscope
--- 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.