AUD/USD Technical Analysis: Passing on Short Trade Setup
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- AUD/USD Technical Strategy: Flat
- Support:0.7715, 0.7638, 0.7469
- Resistance:0.7899, 0.8069, 0.8343
The Australian Dollar may be readying to resume the down trend against its US counterpart after putting in a Bearish Engulfing candlestick pattern. Near-term range support is at 0.7715, with a break below that on a daily closing basis exposing the 14.6% Fibonacci expansion at 0.7638. Alternatively, a push above the intersection of trend line resistance and the 14.6% Fib retracement at 0.7899 clears the way for a challenge of the 23.6% threshold at 0.8069.
While entering short seems compelling from a purely technical perspective, we will tactically opt to stand aside for now. Priced-in expectations ahead of next week’s RBA monetary policy announcement see investors split 50/50 on the probability of another rate cut, seemingly assuring volatility that threatens to derail existing positioning. With that in mind, we will wait for event risk to pass before committing to a directional bias.
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Daily Chart - Created Using FXCM Marketscope
--- Written by Ilya Spivak, Currency Strategist for DailyFX.com