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Talking Points:
- AUD/USD Technical Strategy: Flat
- Support: 0.7649, 0.7528, 0.7330
- Resistance:0.7772, 0.7878, 0.8075
The Australian Dollar recoiled downward against its US counterpart after testing a channel top capping gains since late October 2014. A daily close below the 14.6% Fibonacci expansion at 0.7649 exposes the 0.7528-59 area (23.6% level, March 11 low). Alternatively, a push above channel top resistance at 0.7772 opens the door for a test of the 23.6% Fib retracement at 0.7878.
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
